- 19 September 2022 – Trade testing dates and software implementation
SARS will introduce enhancements to the Tax Directives process as indicated in the IBIR-006 Tax Directives Interface Specification Version 6.401. The trade testing dates are still to be confirmed and the implementation of the software is planned for implementation in December 2022. You will receive communication with regards to the exact dates for trade testing and the implementation date closer to the time.
The Tax Directives Interface Specification is available on the SARS website www.sars.gov.za and you are encouraged to review it prior to testing.
Please follow these steps to submit test files:
Step 1: Before testing can commence, you will need to email 10 taxpayer reference numbers to [email protected] to ensure the numbers are active. In the email subject line, use “Tax reference numbers for Trade Testing”. A maximum of 10 taxpayer reference numbers will be allowed.
Step 2: You will be notified via the same email address to confirm when testing may commence.For trade testing queries please email [email protected]
16 September 2022 – Tax Directives enhancements in line with Financial Sector Conduct Authority (FSCA) were implemented
SARS has successfully implemented enhancements to the Tax Directives validation process.
Please note that going forward, SARS will be validating the registration data and status of entities submitting Tax Directive applications with the Financial Sector Conduct Authority (FSCA). Due to the additional control measures, some applications will inevitably be declined due to failed validations if the data that is captured is not aligned with the information on the FSCA website.
Fund Administrators and Long-term Insurers are encouraged to ensure that the registration data (Name of the fund, name of participating employer, name of Long-term Insurer and the registered number) captured on the tax directive application is correct and corresponds with the registration data on the FSCA records.
In the unfortunate event that the tax directive application is declined due to incorrect data captured, kindly ensure that the registration data with the FSCA is used and resubmit tax directive application.
The following Guides were updated:
- 12 September 2022 – Tax Directive Software Implementation
The South African Revenue Service (SARS) will introduce enhancements to the Tax Directives process as indicated in the communication published on 20 July 2022. The planned implementation date is scheduled for 16 September 2022, you will be notified should this date change.
- 16 August 2022 – Tax Directive Enhancements for September 2022
Following previous communication, that the South African Revenue Services will be validating the registration data and status of entities submitting Tax Directive applications with the information captured on the Financial Sector Conduct Authority (FSCA) database, please note that some applications will inevitably be declined because of validations failing where the data is not aligned to the data on FSCA records. For more information click here.
20 July 2022 – Tax Directive Enhancements for September 2022
SARS will be enhancing the Tax Directive Process. This enhancement entails the validation of specific data captured on the tax directive application form against the information held by the Financial Sector Conduct Authority (FSCA).
The changes will only impact the back-end processes of SARS; there will be no changes made to the IBIR-006 Tax Directives Interface Specification.
The following data will be validated against the Funds’ information as registered with the FSCA:
the registered fund name;
participating employer name; and
FSCA registration numbers (participating employer number included) should be captured as it is on the FSCA data base.
Data captured on the tax directive application must correspond with the registration data with the FSCA. Incorrect data or omitted data will result in the tax directive applications being declined. For more information, click here.
28 April 2022 – Legislative changes to the Tax Directives process have been implemented.
The following information is important for Fund Administrators, Insurers, Tax Practitioners, Advisors and taxpayers.
- Taxpayers who are members of a pension preservation or provident preservation fund, who have reached retirement age and are 55 years and older are now allowed to transfer the retirement benefit to another preservation fund or a retirement annuity fund tax neutral on a Form A&D – reason Transfer before Retirement [par 2(1)(c)]
- Taxpayers can now, on retirement, elect to use two thirds (⅔) or more of the total value of the retirement interest in the fund to provide a pension and / or annuity or purchase a living annuity and / or a guaranteed annuity from an Insurer. Alternatively, they can elect to keep a portion of the retirement interest in the fund which will provide a pension and / or annuity and use a portion to purchase a living annuity and / or a guaranteed annuity from an Insurer. However, it is important to note that the condition placed on a purchase of an annuity is that the value of each annuity (living and / or guaranteed and / or remaining in the fund) must be R165 000 and above, respectively.
- A new reason has been added on the IRP3a to cater for foreign companies that are not registered for Pay As You Earn to make severance payments to South African tax residents who have performed work within the Republic for the said company. When the employer pays the employee, the tax practitioner or SARS will select reason <Severance benefit – Paid by a non-resident Employer>
- When the taxpayer/Tax Practitioner completes the return, a new field will be added on the ITR12 to cater for payments made by foreign entities. The taxpayer/Tax practitioner must select <Y>
- This will open a container whereby <new source code 3925) will be generated to capture the amount of the severance benefit received and the Tax Directive number which would have been issued for this purpose.
What are ISV’s or Interface agents?
The ISV’s software interfaces with SARS for the submission of various returns required by SARS. The ISV service was initiated as an extension of the eFiling service. The software vendors approached SARS to integrate with the eFiling service that would reduce user effort and manage the process of completing tax returns. The tax types serviced through the ISV service include:
- Annual Returns :
- PAYE returns
- Transfer Duty
- Tax Directives (Tax Directive submissions have been allowed for a number of years via an interface that allows for the bulk request of directives)
See the letter on the ISV Tax Directives file submission migration to the new SFTP solution.
How does it work?
Secure access is enabled by a unique access key for the specific product and application. After user authentication is done, the interface interaction is allowed. The user is required to be an active user on eFiling with the appropriate rights. Currently we have three categories of ISV’s:
- Tax Returns Submissions
- Transfer Duty
- Directive Requests
For Tax Directives applications the existing process will continue whereby the interface specification and External Application for Access to SARS – Electronic Interface under “Form INF001” to register for access to SARS Interface are available in the Interface Specification IBIR-006 Tax Directives. Please note that the Terms and Conditions are also applicable to Tax Directive applications.