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Record keeping – are you complying with the latest requirements?

Friday, 07 June 2013   (0 Comments)
Posted by: Author: Michelle Scholtz
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Author: Michelle Scholtz (Grant Thornton)

When the Tax Administration Act (TAA) came into effect on the 1 October 2012, effective record keeping was specifically prescribed and failure to comply became a criminal offence which can result in fines or even imprisonment. 

We have summarised the basics of record keeping: 

General requirements of the TAA

  1. Records are defined in the TAA as the records, books of account or documents that a person is required to keep or retain in terms of the TAA.
  2. The record-keeping requirements apply to a person who: 
  • has submitted a return
  • is required to submit a return for a tax period and has not done so
  • due to the application of a tax threshold or exemption is not required to submit a tax return but who, during the tax period, received income, had a capital gain or loss or was engaged in any other activity that has a tax effect or would be subject to tax.

       3. Records must be retained for a period of five years from: 

  • the date of submission of a return, or
  • where no return is required, from the end of the relevant tax period.
  • However, if the records relate to an audit or investigation, or an objection or appeal lodged against an assessment, the records must be retained until the audit is concluded or the assessment or decision becomes final, even if it exceeds five years.

      4. The records must be kept in: 

  •  their original form
  • an orderly fashion
  • a safe place;
  • or in the form, including electronic form, as may be prescribed by the Commissioner.

Electronic records 

Section 30(1)(b) of the TAA and Government Gazette No 787 dated 1 October 2012 specifically prescribes the requirements of electronic record keeping.

  1. Electronic records are defined in the GG as records kept or stored in electronic form on a computer or other electronic storage device which were either originally created in an electronic form, or which were converted from any non-electronic form, to an electronic form.
  2. The GG stipulates inter alia, that: 
  • there must be adequate storage and back up of the electronic records
  • the electronic records must be in an acceptable form that satisfies the standards contained in the Electronic Communications and Transactions Act
  • the records must be easily accessible for inspection by SARS at all reasonable times, if required
  • the records must be kept and maintained at a place physically located in South Africa, unless otherwise authorised by SARS. However, such authorisation will only be given if SARS is satisfied that the records can be accessed from South Africa and that their foreign location will not impair accessibility of the records. 



Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.

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