Kindly take note that SARS will be imposing administrative penalties from December 2018 for outstanding Corporate Income Tax (CIT) returns.
Administrative penalties will be imposed on companies that receive a final demand to submit a return. In terms of Section 210 of the Tax Administration Act of 2011, non-compliance with regards to non-submission of required CIT returns may be subjected to a penalty, as follows:
1) If SARS is satisfied that non-compliance by a person reffered to in subsection (2) exists, excluding the non-compliance reffered to in section 213, SARS must impose the appropriate “penalty” in accordance with the table in section 211;
2) Non-compliance is failure to comply with an obligation that is imposed by or under a tax act and is listed in a public notice issued by the Commissioner, other than:
a) the failure to pay tax subject to a percentage based penalty under part C; or
b) non-compliance subject to an understatement penalty under Chapter 16.
Penalties range from R250 to R16,000 per month that non-compliance continues, depending on a company’s assessed loss or taxable income.
Please note that it is compulsory for registered companies to submit their income tax returns. If a company is dormant, it is still required to submit any outstanding returns prior to 2018 to prevent a penalty being imposed. The criteria for the exception in 2018 are set out in notice 600 of 15 June 2018, which is available on the SARS website.