Frequently Asked Questions
Answers to the most frequently asked questions.
Answers to the most frequently asked questions.
Monthly Premium
incl VAT
Indemnity Limit
* the lesser of the Rand amount or number of Hours of service per annum, limited to 100 Hours for any one claim.
Less than R3,000,000
R249
R250 000 or 50 Hours of service *
from R3,000,000 to R10,000,000
R390
R300,000 or 100 Hours of service *
from R10,000,000 to R25,000,000
R559
R500,000 or 150 Hours of service *
from R25,000,000 to R50,000,000
R999
R750,000 or 200 Hours of service *
from R50,000,000 to R100,000,000
R1 449
R1,000,000 or 300 Hours of service *
Companies with Annual Turnover of more than R100,000,000 may apply for specific cover and pricing.
An excess of 10% of the claim amount with a minimum of R1 500 applies to each claim.
Monthly Premium
incl VAT
Indemnity Limit
* the lesser of the Rand amount or number of Hours of service per annum, limited to 100 Hours for any one claim.
Less than R2,000,000
R235
R100 000 or 50 Hours of service *
from R2,000,000 to R5,000,000
R335
R300 000 or 100 Hours of service *
Individuals with an annual taxable income for more than R5,000,000 may apply for specific cover and pricing.
An excess of 10% of the claim amount with a minimum of R1 500 applies to each claim.
Monthly Premium
incl VAT
Indemnity Limit
* the lesser of the Rand amount or number of Hours of service per annum, limited to 50 Hours for any one claim.
Less than R3,000,000
R199
R250 000 or 50 Hours of service *
from R3,000,000 to R10,000,000
R275
R250 000 or 100 Hours of service *
from R10,000,000 to R25,000,000
R450
R250 000 or 150 Hours of service *
from R25,000,000 to R50,000,000
R650
R250 000 or 150 Hours of service *
from R50,000,000 to R100,000,000
R1 100
R250 000 or 150 Hours of service *
Trading Trusts with Annual Turnover of more than R100,000,000 may apply for specific cover and pricing.
An excess of 10% of the claim amount with a minimum of R1 500 applies to each claim.
Monthly Premium
incl VAT
Indemnity Limit
* the lesser of the Rand amount or number of Hours of service per annum, limited to 50 Hours for any one claim.
All Passive Holding Trusts
R275
R250 000 or 100 Hours of service *
Companies with Annual Turnover of more than R100,000,000 may apply for specific cover and pricing.
An excess of 10% of the claim amount with a minimum of R1 500 applies to each claim.
We answer the most frequently asked questions about tax risk insurance.
Tax risk insurance is the most effective protection for you, your trust and your business if you’re ever selected for an audit by SARS, or if there is a dispute about an unfair tax re-assessment from SARS in terms of which they are demanding additional taxes from you. When you’re covered by a tax risk insurance policy, your tax audit and related dispute problem becomes the insurer's, immediately. Most importantly, the cost of employing top tax specialists to defend your case is covered by tax risk insurance, so you don’t have any unplanned for expenses and can also mitigate your stress.
It’s a fact that SARS is auditing more taxpayers more often these days. Tax audits are part of the SARS mandate to ensure compliance and to maximise tax collections. Anyone who pays tax can be selected for audit.
Even if you employ the best accountant in the world, and you believe like most people that your tax affairs are in order, SARS can still select you for audit. The cost of defending an audit and related dispute like this can run into thousands of Rands in professional fees – money which most people and businesses haven’t budgeted for and can’t afford.
Should SARS find absolutely nothing wrong with your tax affairs, which is most often the case, you will still be liable to pay the bill from your tax advisors for their services rendered. Tax risk insurance, on the other hand, will appoint and pay for a team of top tax professionals to represent you during a SARS tax audit and related dispute. Your trusted accountant will also be part of that team.
Revenue collection authorities have been raising the standard when it comes to tax collection. The financial downtrend worldwide and in South Africa has resulted in revenue services trying to collect more revenue and in doing so, they’ve become much more efficient. Linked to this trend is the fact that SARS has been given additional legislative powers through the Tax Administrations Act of 2011 to achieve their collection objectives.
SARS reports that it exceeds its audit coverage targets, conducting more tax audits than budgeted. This is the unnerving reality – SARS are now auditing more taxpayers more often – and statistically, there’s no reason why you couldn’t be next.
If you’re selected for a SARS tax audit, or if there is a dispute about an unfair tax re-assessment where SARS is demanding additional taxes from you, then we’ll appoint and pay for the team of tax professionals to deal with he matter. These may include Accountants, Tax Attorneys, Auditors, Tax Specialists and other Tax Advisors who we think will ensure a fair audit outcome.
We will cover the following:
• Income tax audits
• VAT
• Employees tax audits
• Capital gains tax audits
• Dispute resolution hearings and appeals to the Tax Board and the Tax Court
Considering the risk you’re facing, tax risk insurance is actually quite affordable. Premiums are dependent on your annual taxable income for personal taxpayers, or annual turnover for companies.
You can easily calculate your own premium by requesting a quotation from your broker.
Each taxpayer must purchase his / her / its own policy because only the taxpayer named in the policy will receive cover under that policy. So for example, if you have three businesses and two shareholders, you may consider purchasing five separate tax risk insurance policies – one for each taxpayer.
No. The costs of preparing your routine tax returns are not covered and those remain your own responsibility, as before. Requests from SARS to you to supply supporting or verifying documentations and information in support of your filed tax return are therefore also not covered.
Remember, insuring yourself against the risk of a SARS tax audit does not absolve you from paying your taxes correctly and filing your returns. You must continue to pay your taxes as expected: not only is it the law, but it’s also the right thing to do as a participating member in society.
No. Penalties and interest that are fairly imposed by SARS are not insurable. Tax risk insurance ensure that you receive the best representation in the event of a SARS audit, which will guarantee a fair audit outcome.
Please see the Summary of Cover to read the most important exclusions under this policy. You can also request the full policy wording from the insurers at info@taxrisk.co.za which provides a complete explanation of your cover. Or speak to your financial advisor.
Depending on the nature and severity of the SARS tax audit, the insurers will establish a panel of experts in your defense. This will include your own accountant, but could also include external tax specialists from our panel such as tax attorneys, tax accountants, tax advisors and other tax specialists as may be required to ensure a fair outcome. They’ll bring together whoever they think would be in your best interests, so they can find an effective resolution in the most efficient way.
Yes – errors are human. As long as there is no fraud or willful tax evasion involved, the policy will continue with cover as normal.
All tax practitioners are required by law to maintain professional indemnity insurance. Should you have been prejudiced by professional negligence on the part of your tax practitioner, you may take issue against his professional indemnity insurance. Professional indemnity insurance is quite separate from your tax risk insurance policy, which pays for the cost of defense if you happen to undergo a SARS tax audit or related dispute.
Cover will not operate in the event of fraud and tax evasion. It’s absolutely important that taxpayers continue to pay their taxes as required, and we encourage our clients to comply.
Yes. There is an aggregate annual Rand and number of hours of service limit, and a per claim limit. Your limit of indemnity will be provided together with your quotation and is indicated on your Policy Schedule.
The policy only cover local taxes payable to SARS. Taxes payable outside of South Africa or on revenue generated from outside of South Africa, or anything relating to exchange control, and customs and excise are not covered under this policy.
A claim starts when you’re notified of a SARS tax audit, usually by way of a letter from SARS. This excludes any type of verification audit and request for supporting and/or supplementary information from SARS. You must contact us or the insurer within 30 days of you becoming aware of a SARS tax audit or dispute.
You must notify us or the insurers as soon as possible, but no later than 30 days from the date the SARS tax audit starts. The insurer will then send you a claim form and take complete control of the matter from there. Critically for you, if you’re covered by a Tax Risk Insurance policy, your SARS tax audit problems becomes the insurer's problem, immediately.
Administered by Tax Risk Underwriting Managers (Pty)Ltd.
Registration Number 2014/086896/07. An authorised financial services provider FSP 46467.
152 Bryanston Drive, Bryanston, Sandton, 2191
Phone: +27 (0) 861 473 738 Email: info@taxrisk.co.za
Underwritten by Bryte Insurance Company Limited.
Registration Number 1965/006764/06. A licensed non-life insurer and authorised financial services provider FSP 17703.
Rosebank Towers, 15 Biermann Avenue, Rosebank 2196
Phone: +27 (0)11 370 9111 Email: info@brytetaxrisk.co.za
Sable Corner, Bridgeways, Precinct, 15 Bridgeway, Century City, Cape Town, 7441
© Copyright 2024 - All Rights Reserved - GS Financial Services is an authorised financial services provider FSP13271