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Further Concerns Highlighted By SAIT Members Regarding the Debit Pull Discontinuation Sent to SARS

Tuesday, 10 September 2013   (1 Comments)
Posted by: Author: SAIT Technical
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Author: SAIT Technical

Dear SARS, herewith please find further concerns and questions that our members have in this regard:

 There appears to be some hoping ambiguity regarding the phasing out of the Debit Pull facility. With reference to the excerpt below, it is confirmed that the change only takes place after 1 month.  However, the sentence that follows states that where the taxpayer/practitioner agrees to the terms and conditions they will still be able to make the payment.  Does this mean that the debit push transaction would be available beyond September 2013 as long as the taxpayer/practitioner accepts the terms and conditions?


"SAIT is aware of the problems experienced with the discontinuation of debit pull transactions introduced by SARS this week (see notice here), but that should only have effect within one month. In this regard we wish to point out that SAIT has been informed by SARS that if the taxpayer/practitioner agrees to the terms and conditions, the debit pull will still continue (that is it is not phased out yet).”

The following is what needs to be confirmed:

1.       The Debit Push transactions will not be available after September 2013

2.       Between 4 September and the end of September debit pull transactions can still be made except for "additional payments”

3.       Where debit push transactions are made between  4 September and the end of September, the terms and conditions have to be agreed to under penalty of a fine / imprisonment if unapproved payments are made

4.       Payments can only be made using credit pull transactions after September

  • VAT payments - Vendors that lodged their returns via e-filing had until the 30th to pay electronically, same was normally done through the "debit pull” .  Does this mean that VAT vendors that do not have the credit pull function will have to settle their VAT on the 25th?
  •   Debit pull allowed you to pre-set a date of payment which ensured that payments were "pending” for a future date which was a very handy tool especially over festive seasons or where staff goes on leave in the year.  Does "credit pull” allow you to set a date of payment in the future?
  • Over the counter payments can only be made at ABSA, FNB, Nedbank and Standard Bank.  Will Capitec, Bank of Athens, Mercantile Bank and Bidvest be added or not? Furthermore, some banks are not aware of this new provision namely Standard Bank and Nedbank and they are not willing to create group accounts.
  • ABSA Credit pull function -  Client needs to authorise the request the same day, if not you have to re-do the application – penalties and interest will thus be incurred.
  • What about tax practitioners that have clients who stay in other countries (eg Namibia, England & Germany) who entrust them with setting up tax payments for their respective tax concerns in SA. This could pose a real problem for them to set up the payments from abroad (See also specific concern below).
  •   I am an individual, i do not use a tax practitioner, how does this "Credit pull Payment system" effect my business?

Specific concerns: 

Foreign clients

Currently it can take up to a week to transfer the funds of a foreign client into a south African bank account from a foreign country. Furthermore the South African account in one particular example is hosted by Bidvest which is not on the Credit Push system. The client PAYE bill (which is paid in Pounds on the last day of the month) is calculated on the grossed up amount using the current exchange rate and then this request must be forwarded to the Development Bank for international funding in the foreign country to transfer the PAYE amount to South Africa. So normally on the 7th the money is in the bank account and the additional payments facility is used to load 2-3 debit orders of R500 000.00 on the 7th so as to avoid the penalty due to limitation of R500 000.00 on debit orders. When making use of the normal payment system on the return you have to split the debit order over several days (which will result in penalties) or different bank accounts which is also not possible as the we only have one south African bank account. We can’t request the an advance payment on the funds as DFID and Comesa (Common Market for Eastern and Southern Africa (COMESA)) have strict rules on payments made and impress amounts received as they do the funding and also pay the South African employees directly from the foreign country.”

Additional payments:

The "additional payments” facility is used in cases where clients defaulted on previous PAYE/VAT and they have given SARS an undertaking that they will on a monthly basis pay a fixed amount towards these outstanding accounts.Every month their tax practitioner therefore prompts their clients who find themselves in this predicament and upon their approval, the tax practitioner then proceeds to do the payment after which the tax practitioner then writes a letter to SARS and requests the correct allocation of these additional payments. By disallowing this, there is a chance that these down payments on old outstanding balances will simply not happen. In this economy taxpayers are tight on cash and if it is up to the taxpayer to decide if they are going to pay SARS an old outstanding amount or not, it is probably not going to happen. Yes, they could also say "no” if we ask their written permission to proceed, but it is much harder to say "no” if we as tax practitioners ask.

Furthermore, the " ADDITIONAL PAYMENTS” facility is used for making IT 88 payments. And the debit pull has been removed from this facility. How does SARS propose employers make these payments (no internet facility or internet banking)?

Banks unaware of what to do

I have just been to Absa to establish exactly what I need to tell my client and Absa do not have a clue what I was talking about.I tried setting up a credit pull yesterday but it failed, when I phoned Sars Call Centre I was informed the client go into the bank and have it set up, how they can do this when they do not have a clue what they need to do.


The ability to assist clients with their payments, having ensured that tax practitioners have the relevant, appropriate and sufficient mandate to do so, has not only been a value add to a tax practitioner’s clients business’ but has also given tax practitioner clients an additional level of assurance as relates to their payments having been made timeously and appropriately. Ultimately tax practitioners uphold an ethics code when it comes to the payment of taxpayers accounts to SARS and with the regulation of tax practitioners surely this should bring some sort of mechanism into the loop that SARS can use to trace the fraud and bring those that perpetrate it to book.

We suggest that:

1) The debit pull system remains in place until a proper alternative is available and accepted by all parties involved.

2) A more acceptable and user friendly system be introduced by SARS by the implementation of more safeguards and security measures in the existing debit pull system rather than discontinuing the system in its entirety.

3) Could SARS not perhaps issue a form to be completed by taxpayers – as with the introduction of e filing where SARS issued an " E filing mandate” to be signed by all taxpayer prior to the tax practitioner being allowed to activate the  taxpayer on their profile - where they agree to SARS payments being made Via the debit pull. This form could either be lodged with SARS or be held by the practitioner in the event of SARS requesting a copy of the Mandate / authorisation for payments to be made by debit pull?

Note to Tax practitioners:

  You will need to ensure that your clients don’t use the historic "payment references” but rather the unique references for each period to avoid a lot of journal entries from being processed. 


Bridget L. Ms says...
Posted Friday, 13 September 2013
I have contacted both Nedbank and Standard Bank for some of my clients and both banks have no idea how to facilitate these transactions. These complications see to be based on multiple signatories and business accounts vs sole trader accounts. This is going to cause more non payments to sars and an endless admin nightmare form us. Could SARS not have approached the 4 major banks for clarity first on the ease of the change over, so there is a clearly defines course of action?



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