In a new press release, the South Africa Revenue Service (SARS) says it will be stepping up measures to find citizens who have not declared their crypto assets and trades.
This follows recent reports that the tax authority had begun issuing tax notices to crypto traders based on information obtained from exchanges.
REGULATION | The South Africa Revenue Service (SARS) Begins Issuing Tax Notices to Crypto Traders
Failure to provide requested information could be deemed a criminal offense under the Tax Administration Act, the officers say. The national revenue authority has adopted a… pic.twitter.com/NZ5vJJlHZz
— BitKE (@BitcoinKE) September 9, 2024
“In implementing our mandate, SARS has recently issued query letters to taxpayers with crypto assets. These letters aim to gain an insight into taxpayers’ investment in crypto assets and the trades undertaken to enable SARS to assess taxpayers’ compliance in this regard.”
SARS said there has been phenomenal growth in the use of various digital currencies by many South Africans with crypto assets being particularly widespread.
“A staggering number of more than 5.8 million South Africans hold a crypto asset, with Southern Africa boasting the largest uptake of Bitcoin globally,” said SARS.
“SARS is concerned that these crypto assets and trades are not being declared on the tax returns of taxpayers.
SARS is legally obligated to account for any income or assets held by taxpayers and had previously invited crypto exchanges and those involved in trading or holding crypto assets to disclose related activities on a voluntary basis.”
Consequently, SARS announced it will be including crypto assets into its compliance programmes. Already receiving information directly from the local exchanges, it will also be seeking more information from the Financial Sector Conduct Authority (FSCA) on Crypto Asset Service Providers (CASPs).
South African Revenue Service (SARS) Requests for Customer Information from 3 Crypto Exchanges: https://t.co/cT2Ejdypnh
— BitKE (@BitcoinKE) June 3, 2021
Additionally, the provision of offshore crypto accounts will be the subject of a multi-lateral agreement to be signed by Ministers of Finance in November 2024 which will catalyse the cross jurisdictional exchange of such information in respect of South African taxpayers.
SARS also notes it has resorted to greater use of artificial intelligence, machine learning and algorithms to aid their capabilities in dealing with such matters.
“SARS has been working ceaselessly to ensure compliance by all taxpayers, and those who are evading their responsibility make the burden of compliance difficult for compliant taxpayers. This is not only unfair to honest taxpayers but affects the vulnerable in society disproportionately by limiting the state’s ability to deliver social grants and other much needed social benefits,” said SARS Commissioner, Mr. Edward Kieswetter.
“Let all know that technology has enhanced SARS’ ability to root out non-compliant taxpayers. Be warned, SARS will pursue all without fear, favour or prejudice.”
Follow us on X for latest posts and updates
Join and interact with our Telegram community
______________________________________
______________________________________
