In terms of the Tax Administration Act, 2011, all tax advisers are required to find a controlling body before 1 July 2013.
Recently the South African Revenue Service (SARS) found that 9.5 percent of tax practitioners, who assist some four million taxpayers, are not tax-compliant in that they are either not registered with SARS or their own tax affairs are not in order.
The main purpose of the regulation of the tax profession is to protect the public against rogue tax practitioners, says Stiaan Klue, chief executive of the South African institute of Tax Practitioners (SAIT).
He explains that recently the South African Revenue Service (SARS) found that 9.5 percent of tax practitioners, who assist some four million taxpayers, are not tax-compliant in that they are either not registered with SARS or their own tax affairs are not in order.
Klue warns that the tax profession has to rebuild its trust with both SARS and the public, saying, years of unregulated industry has created its scars.
During the Budget speech earlier this year, Minister Pravin Gordan criticised Tax Practitioners, alleging that they owed over R260 million to the State, and accounted for more than 18 000 outstanding income returns in their personal capacity, he notes.
“In recent years tax legislation has become very complex and the non-compliance highlighted by the minister can be directly linked to the practitioners’ technical ability to perform the work,”
He says the tax profession is one of the first to be registered by South Africa Qualifications Authority (SAQA) since the National Qualifications Framework (NQF) Act came into effect on 27 July 2012.
The tax profession now joins the list of professional designations whose statuary and non-statuary professional bodies will have to comply with criteria set out by SAQA.
In preparation for the new legislation, SAIT was appointed as the National Board Examination adjudicators for tax professionals on 30 November 2012 under the mandate of the Quality Council for Trades and Occupations (QCTO), following SAIT’s official recognition as a Professional Body by SAQA on November 29.
Looking at SARS’ Strategic Plan 2012-2017, non-registered practitioners owe SARS on average four times more tax than their registered professional counterparts.
As a recognised professional body, SAIT has now been empowered with their own Taxation Disciplinary Board, which can take action against Practitioners if they commit fraud or act unprofessionally.
When the new tax season starts in July 2013, it will be illegal for a Tax Practitioner to file a client’s tax return without being registered with a professional body assigned by SAQA.
As the tax industry moves away from self-regulation into a more transparent national framework and government oversight, Klue says being recognised by SAQA as both a professional body and the official adjudicators of the National Board Examination under the NQF, is crucial in establishing SAIT tax professionals as the pre-eminent.