VAT Refunds & What Can Be Done To Expedite The Refund

We all know how frustrating it can be to wait for a VAT refund from SARS, which has a negative effect on cash flow within businesses.

You are entitled to a VAT refund (if applicable) within 21 business days of submitting the VAT return; if you have not received a VAT refund within this turnaround time, it may be because SARS selected the specific return for review, which generally occurs when the return is incomplete or incorrect, or if the VAT refund due differs substantially from the previous VAT returns submitted.

No-one wants to be selected for an audit as this may have a negative impact on the taxpayer’s good standing with SARS, as well as the financial strain this might have on the business due to not receiving your refund timeously.

To avoid a possible VAT audit:

1. Ensure that the VAT return has been filed correctly with all the relevant supporting invoices for the correct period.
2. Ensure all information on eFiling is correct e.g. banking details; public officer, address and contact details.

Should you be selected for review, it is advisable to submit all the relevant information and supporting documents immediately upon SARS’ request.

Supporting documents that are usually requested for the review are:

1. 5 of the largest input VAT invoices
2. 5 of the largest output VAT invoices
3. VAT report detailing all the VAT transactions for the vat period.
4. The maximum turnaround time allowed by SARS for a VAT review is 90 business days.

 

Here are a few tips and tricks that may help in getting that refund paid out sooner rather than later:

1. Check correspondence from SARS regularly to ensure that you comply with any further requests and deadlines by SARS.
2. Even though the turnaround time is 21 working days to submit the supporting documents, try to submit these supporting documents to SARS as soon as the request comes through for the VAT review.
3. If your VAT refund has not been finalised by SARS within the 90 business days, a phone call to SARS is required to escalate the case with SARS. Take note of case reference numbers provided as well as the consultants’ name, this will come in handy for referral when chasing SARS after the turn-around time has elapsed.
4. Give the escalated case a week (after turn-around time has elapsed) and if the case has still not been finalised, lay a complaint on efiling listing all the previous case reference numbers for referral in support of your complaint.
5. The complaints’ turn-around time is 21 working days, however, do not wait for this turnaround time to elapse. It is best to follow up weekly as this will help speed up the finalisation of the review with SARS.
6. In the event the review is still not finalised after you have been through the complaints process, you can make use of the SARS Ombudsman.

 

 

Don’t allow these frustrations to get you down.

Contact TLOK Accountants on (011) 794-5582 or info@tlok.co.za for assistance.