South African Revenue Service

Deregistration of Tax Types

 Welcome to the
SARS
Tax Workshop

Purpose:
This presentation is merely to provide information in an
easily understandable format and is intended to make
the provisions of the legislation more accessible

Disclaimer:
The information therefore has no binding legal effect and the
relevant legislation must be consulted in the event of any
doubt as to the meaning or application of any provision.
 SARS Vision 2024
To build a smart modern SARS with unquestionable integrity, trusted and admired by
Government, the public, as well as our international peers.

For the purpose of this presentation, we focus on the following strategic intent:

MODERNIZE
SYSTEMS TO
MAKE IT EASY &
PROVIDE SEAMLESS
SIMPLE TO COMPLY
ONLINE DIGITAL
SERVICES

MAKE IT HARD TO
NOT COMPLY

CREATE USE DATA FOR

AWARENESS, INSIGHTS, RISKS &
CLARITY & IMPROVED
CERTAINTY OUTCOMES

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 Points to discuss

Overview

Legislation

Who can request deregistration of tax types?

When will an entity deregister and common tax types?

Deregistration process

Turnover tax deregistration

Supporting documents

Tax Compliance

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 Overview

• This presentation outlines the relevant procedures to be followed when a

taxpayer applies for a deregistration of a tax type.

• This means that the status of the tax reference number for which the
application is, will change to “Deregistered” after the finalisation of the
deregistration process by SARS. This status will apply from a determined
date.

• Once the tax type is deregistered and all tax obligations at date of
deregistration are met, the taxpayer or representative taxpayer is released
from any further tax obligations attached to the tax type.

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 Applicable Legislation - VAT Act

Section 24 of the VAT Act states that:

1) Subject to the provisions of subsection (2), every vendor shall cease to be liable to be
registered where the Commissioner is satisfied that the total value of the vendor’s taxable
supplies in the period of 12 months commencing at the beginning of any tax period of the
vendor will be not more than the amount referred to in section 23 (1) or (1A).
2) Every vendor who wishes to have his registration cancelled in the circumstances
contemplated in subsection (1), may request the Commissioner in writing to cancel his
registration, and if the Commissioner is satisfied as contemplated in subsection (1), the
Commissioner shall cancel the vendor’s registration with effect from the last day of the tax
period during which the Commissioner was so satisfied, or from such other date as may be
determined by the Commissioner, and shall notify the vendor of the date on which the
cancellation of the registration takes effect.
3) Every vendor who ceases to carry on all enterprises shall notify the Commissioner of that
fact within 21 business days of the date of such cessation and the Commissioner shall
cancel the registration of such vendor with effect from the last day of the tax period during
which all such enterprises ceased, or from such other date as may be determined by the
Commissioner.

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 Applicable Legislation - VAT Act

4) Any notification by a vendor in terms of subsection (3) shall be made in writing to the
Commissioner and shall state the date upon which that vendor ceased to carry on all
enterprises and whether or not that vendor intends to carry on any enterprise within 12
months from that date.
5) Where the Commissioner is satisfied that a vendor—
(a) no longer complies with the requirements for registration as contemplated in section
23 (1) and (3); or
(b) has failed to furnish the Commissioner with a return reflecting such information as may
be required for the purposes of the calculation of tax in terms of section 14 or 16,
the Commissioner may cancel such vendor’s registration with effect from the last day of the tax
period during which the Commissioner is so satisfied, or from such other date as may be
determined by the Commissioner: Provided that where such person lodges an objection against
the Commissioner’s decision under this subsection the cancellation of that person’s registration
shall not take effect until such time as the Commissioner’s decision becomes final and
conclusive.

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 Applicable Legislation - VAT Act

6) Where any person has been registered as a vendor in consequence of an application made
by him under section 23 (3) and subsequent to the registration of that person as a vendor it
appears to the Commissioner that such person’s registration should be cancelled by reason
of any of the circumstances referred to in section 23 (7), the Commissioner may cancel such
person’s registration with effect from a date determined by the Commissioner: Provided that
where such person lodges an objection against the Commissioner’s decision under this
subsection the cancellation of that person’s registration shall not take effect until such time
as the Commissioner’s decision becomes final and conclusive.
7) The Commissioner shall give written notice to the person concerned of his decision to cancel
such person’s registration in terms of this section or of his refusal to cancel such registration.

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 Applicable Legislation - PAYE

Paragraph 15 of the Fourth schedule states that:

(3) Every person who is registered as an employer shall within 14 business days after ceasing
to be an employer, notify the Commissioner in writing of the fact of the employer have ceased to
be an employer.

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 Applicable Legislation - Income Tax

Micro business – Voluntary deregistration

Paragraph 9 of the sixth schedule states that:

1) A registered micro business may elect to be deregistered before the beginning of a year of
assessment or such later date during that year of assessment as the Commissioner may
prescribe by notice in the Gazette.

2) A registered micro business that elects to be deregistered under subparagraph (1) must be
deregistered by the Commissioner with effect from the beginning of that year of assessment .

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 Applicable Legislation - Income Tax

Micro business – Compulsory deregistration

Paragraph 10 of the sixth schedule states that:

1) A registered micro business must notify the Commissioner within 21 days from the date on
which—

a) the qualifying turnover of that registered micro business for a year of assessment
exceeds the amount described in paragraph 2, or there are reasonable grounds for
believing that the qualifying turnover will exceed that amount; or

b) that registered micro business is disqualified in terms of paragraph 3

2) The Commissioner must, subject to subparagraph (3), deregister a registered micro

business with effect from the beginning of the month following the month during which the
event as described in subparagraph (1) (a) or (1) (b) occurred.
3) If the increase in the qualifying turnover of that person to an amount greater than the amount
described in paragraph 2 is of a nominal and temporary nature, the person must apply to the
Commissioner for a decision whether the person must remain a registered micro business or
not.

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 Applicable Legislation - Income Tax

Section 82 of the Companies Act states that:

1) When the affairs of a company have been completely wound up, and a court order of final
liquidation has been made; the Master must promptly file a certificate to that effect, together
with a copy of the court order.

2) In addition to the duty to deregister a company contemplated in subsection (2)(b), the

Commission may otherwise remove a company from the companies register only if-
b) the Commission—
(ii) has received a request in the prescribed manner and form and has
determined that the company—
(aa) has ceased to carry on business; and
(bb) has no assets or, because of the inadequacy of its assets, there is no
reasonable probability of the company being liquidated.

3)If the Commission deregisters a company as contemplated in subsection (3), any interested
person may apply in the prescribed manner and form to the Commission, to reinstate the
registration of the company.

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 Who can request deregistration of tax types?

• An Individual Taxpayer

• An executor of a deceased estate

• A curator for an Insolvent estate

• Representative of a Company (Public Officer), Co-Operative

• Main member of a CC

• Representative of a Government entity

• Main Trustee for a Trust

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 When will an entity deregister?

When a Company/CC, Trust, Co-operative or any other type of entity is dormant or no

longer in operation

When a deregistration was initiated internally by SARS

When an entity has a duplicate reference number

When a taxpayer who formally emigrated from South Africa or a non-resident taxpayer who
left the republic, has no income and assets in the republic

When a deceased, insolvent or liquidated estate comes into effect

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 Common Tax types to deregister

Value-Added Tax (VAT)

Pay-As-You-Earn (PAYE)
*Skills Development Levy (SDL) and/or
*Unemployment Insurance Fund (UIF)

Income Tax

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 Deregistration process VAT and PAYE
VAT

A written request for deregistration can be submitted via an appointment.

Fully completed VAT123e or VAT123T in the case of a separate registered

enterprise/branch/division (date business ceased trading is mandatory)

PAYE

A written request for deregistration can be submitted via an appointment OR sent to these
email addresses :
Tax Practitioners: [email protected]
Taxpayers: [email protected]

To make it easier for employers to request a deregistration without any additional

supporting documents/written requests (EMP123/written notification), new system channels
have been introduced, whereby an employer can request a deregistration for
PAYE/SDL/UIF(eFiling- Registration Maintenance)

Fully completed EMP123 (date business ceased trading is mandatory)/written notification.

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 Deregistration process for PAYE,SDL and UIF

An employer must request in writing for the deregistration as an employer:

• Within 14 business days after an employer‘s activities have ceased;

• Within 14 business days after the business has been sold.

• This process must be done on eFiling or a written request must be sent to SARS.

• The SDL registration will be cancelled if the total remuneration for employees will not
exceed R500 000 per annum.

When PAYE is still active, UIF must be registered with SARS. Only when PAYE is cancelled
on the SARS record, UIF is automatically cancelled on the SARS record. The UIF payments
must be done with the Department of Labour.

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 Supporting documents required upon deregistration

Companies:
• The taxpayer must apply at CIPC for deregistration before SARS can proceed with
deregistration.

• CIPC requires you to be Tax Compliant before they consider your application therefore it
is important to ensure your tax compliance with SARS.

• Proof of deregistration from CIPC must be presented to SARS.

• 12 months banks statement that ends on the day before the application date to de-
register
Trusts

- Letter from the Master High Court to confirm termination date, including minutes of the
trustees meeting in which a resolution was taken to deregister the trust.
- Distribution list and or financial statements until termination date.

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Common Errors made by Taxpayers upon deregistration that
cause delays -Top 5 errors)

• CIT deregistration – no FINAL Deregistration or AR Final deregistration documents

from CIPC attached

• PIT (non-resident coding for individuals) – Confirmation of the date the person left
South Africa, copy of passport

• VAT deregistration – VAT123 (cancellation of VAT number) not fully completed with the
applicable dates of suspension and declaration not signed

• PAYE deregistration – EMP 123 (cancellation of Paye number) not fully completed with
the applicable dates of suspension and declaration not signed

• Request for all tax types deregistration coming through the Email Channel – no Power
of attorney and well as a copy of ID for the representative person.

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 SARS Online Query System(SOQS)

For any related queries or submission of the supporting documents use the following
channel:

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 Tax Compliance
How to become compliant?

Submission of
Returns

No returns are outstanding

after the filing due dates

Registration TAX Debt

COMPLIANCE
STATUS
Any outstanding tax debt
Registered and active for the
with SARS for which
tax products that you are
payment arrangements
liable for.
Supporting have not been made.
Payment Arrangement:
Documents
• eFiling
• SARS MobiApp
Outstanding supporting
documents requested by
SARS have been submitted.

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 Go Digital
Remember our Digital Channels
▪ We’ve made it easier for you
Go Digital!
• Download the SARS MobiApp via your app store
• Register for eFiling
• SARS Online Query System

▪ Visit us on our Social Media platforms

• LinkedIn Facebook Twitter

▪ For more information on Deregistration of tax types, please visit:

▪ SARS website: www.sars.gov.za

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