Dealing with "Tax Ghosting"? Why a SARS Voluntary Disclosure is Your Best Move This February

Have you been “ghosting” the South African Revenue Service (SARS)?

Perhaps you moved to the UK years ago and stopped filing South African tax returns, or maybe you later realised that South African rental income, investment growth, or other South African-source income should still have been declared.

Many expats find themselves in this position unintentionally. The important point is that there is a lawful, structured way to address historic non-compliance - and for many, February is the right time to act.

As the South African tax year comes to an end on 28 February, unresolved SARS issues often resurface. The good news is that South Africa offers a permanent statutory mechanism to regularise past non-compliance: the SARS Voluntary Disclosure Programme (VDP).

What is the SARS Voluntary Disclosure Programme (VDP)?

The VDP allows taxpayers to voluntarily come forward to disclose historic tax non-compliance before SARS becomes aware of it.

Where an application is accepted, SARS may grant:

• Relief from criminal prosecution

• Remission of understatement penalties, which can otherwise be as high as 200%

While understatement penalties may be waived, interest on outstanding tax remains payable, and SARS may impose certain administrative conditions as part of the VDP agreement.

Why Timing Matters

With increased global data sharing between HMRC and SARS under the Common Reporting Standard (CRS), the “wait and see” approach is becoming increasingly risky.

CRS reporting does not automatically trigger assessments, but it does provide SARS with third-party information. If SARS becomes aware of the non-compliance first - for example through CRS data - a future VDP application may no longer be available.

Once SARS has issued an audit notification or initiated an investigation, the opportunity to make a voluntary disclosure is lost.

In short: approaching SARS voluntarily is always preferable to responding after the fact.

A Strategic Reset at Year End

Although the VDP has no formal deadline, the end of the South African tax year is a natural point for tax housekeeping.

Regularising historic non-compliance now allows you to enter the next tax year with:

• A properly documented SARS position

• Reduced risk of penalties and enforcement

• Greater clarity and peace of mind

For many expats, this represents a strategic reset rather than simply a compliance exercise.

How SAUK Tax Supports You

A successful VDP application requires:

• A genuinely voluntary disclosure

• Full and accurate disclosure of all relevant facts

• Careful alignment with your South African tax residency status and cross-border position

Errors, omissions, or poorly structured applications can result in rejection, potentially exposing taxpayers to penalties and increased scrutiny.

At SAUK Tax, we combine deep cross-border technical expertise with rigorous compliance processes to guide clients through this sensitive process. We ensure that disclosures are technically robust, properly structured, and aligned with both South African and UK tax considerations, while maintaining strict confidentiality and data security.

Take the First Step

Whether the issue relates to undeclared rental income, historic investment gains, or a failure to properly conclude your South African tax affairs, support is available.

If you are unsure of your current SARS position, a confidential discussion can help clarify your options before the tax year closes. Contact Jolanda and the SAUK Tax team to explore how you can regularise your South African tax affairs with confidence and integrity.