Draft IN: Persons not eligible to register as a tax practitioner and deregistration of registered tax practitioners.

Subject to specified exceptions, a natural person who provides advice on the application of a tax Act, or who completes or assists in completing a return on behalf of another person, must register with or fall under the jurisdiction of a recognised controlling body, and must register with SARS within prescribed periods. Persons who are not registered with both a recognised controlling body and SARS, may not practice as a tax practitioner and those who do are guilty of a criminal offence, which, upon conviction carries a fine or imprisonment of up to two years upon conviction.

Section 240(3) of the Tax Administration Act prohibits SARS from registering a person as a tax practitioner and requires that SARS deregisters a registered tax practitioner under certain circumstances, section 240(3)(d) specifically dealing with tax non-compliance. In accordance with section 256(3), tax compliance is measured against the obligation to register for tax and submit returns, as well as the obligation to pay outstanding tax debts or make arrangements in relation to such returns or debts.

Deregistration of tax practitioners affects livelihoods, business continuity, as well as the taxpayers whom they serve. It is in the interest of persons who want to practice as tax practitioners to remain tax compliant or remedy their non-compliance as soon as possible. Prospective or registered tax practitioners are therefore encouraged to act upon a notice by SARS in order to be registered expeditiously, avoid deregistration, or reduce the period of deregistration.

A draft IN has been published by SARS on 7 June 2022, with the purpose of providing guidance on when, due to non-compliance, a person may not register as a tax practitioner, and when SARS must deregister a registered tax practitioner, as well as the period of non-qualification for registration. The draft IN provides guidance under the following headings:

• Conditions for non- or deregistration as a tax practitioner;
• Condition one: Non-compliance;
• Condition two: The failure to demonstrate compliance or remedy non-compliance; and
• The interrelationship between condition one and two.

The draft IN can be accessed here. 

20/06/2022