In tax season, usually, you’ll either be happy about a tax rebate, or preparing to part with some cash because you owe the South African Revenue Service (SARS). Whichever applies to you, you’re still legally obliged to file your tax return.

Unfortunately, because tax season results in an increase in communication between taxpayers and SARS at the same time every year, it’s also a time when scammers get more active with their fraudulent schemes. Fraudsters may pretend to be SARS employees and target you with an official-looking message to scam you out of your hard-earned cash.

Tax communication red flags

There are new scam alerts constantly, making it difficult to keep up with what’s real and what’s fake. Here are some red flags that may indicate someone is trying to scam you:

• Requests for your banking details, passwords, credit card details, or other personal information. This message could be sent through post, email, phone call or SMS.
  
  
• Electronic messages with hyperlinks to other websites.
  
  
• Communication that is poorly worded and has spelling or grammatical errors.
  
  
• The number or email address of the sender is not listed as an official contact for SARS.
  
  
• The message asks you to make direct EFT payments into personal accounts.
  
  
• The message links have redirects to any websites that aren’t sars.gov.za or secure.sarsefiling.co.za.
  
  
• Communications contain *.htm or *.html attachments.
  

Top 4 tax scams doing the rounds in 2024

If you find any of these in your mailbox, act immediately. Report them, delete them, and forget about them. Never click on any links, download attachments, or respond with personal information.

Phishing scams
 

Phishing scams top the list because they are the most common and easiest to fall for. These emails might look legitimate, but they’re trying to steal your personal information. Some might even use email addresses that look like SARS correspondence, along with the SARS letterhead.

If you get an email claiming to be from SARS, log in to your SARS eFiling account from a secure browser and check your inbox. All official correspondence should be there. If it’s not, the email is probably a scam. Delete it and forget about it.

Still unsure? You can always double-check by contacting SARS through the verified channels listed on their official website. Phishing emails often push urgency, saying you must act now or face severe legal consequences. Don’t rush. Always verify before you act. If the message is legitimate, you can then provide information through the correct SARS channels.

Fake tax practitioners

If you don’t have the time or know-how to complete your tax returns, you’re probably considering hiring a professional. Be careful. Fraudsters see this as an opportunity to make a quick buck. They might promise to complete your tax returns, but instead, charge you a fee for a job they either don’t do or aren’t qualified to do. This can leave you with a hefty fine for missing deadlines and not complying with regulations.

Always check a tax consultant’s credentials. It’s best to go with a registered tax practitioner. Registration involves a dual process between the recognised controlling body (RCB) and the tax practitioner.

According to SARS, to register as a tax practitioner, a person must:

• belong to or fall under the jurisdiction of an RCB as per section 240A of the Tax Administration Act,
• have the minimum qualifications and experience required by their RCB,
• have no criminal convictions for the offences outlined in section 240(3) of the Tax Administration Act, and
• participate in continuous professional development programmes set by their RCB.

Phoney offshore investments

If you’ve contributed your annual or lifetime maximum to your tax-free investments (TFIs), you might be tempted to respond to a message claiming that you can invest more money tax-free in offshore accounts. Don’t fall for this – SARS regulations allow you to save only R36,000 a year and R500,000 during your lifetime in tax-free accounts, no matter where they are held. Even offshore accounts and international investments must be declared to SARS.

If someone promises that they can invest your money without you having to pay tax on the interest, when the product they’re offering isn’t a recognised TFI or you’ve already made your maximum TFI contributions, they’re getting you involved in fraudulent activities. By attempting to dodge taxes, you’re not only risking your money with shady characters who might vanish with it, but you’re also implicating yourself in tax evasion. The best approach is to opt for legitimate savings and investments, and consult a professional financial adviser. They can help you grow your money in a tax-efficient manner.

Illegitimate tax collectors

Watch out for fake tax collectors. These scammers pose as SARS representatives, insisting that you owe the tax regulator money and threatening you with jail time or hefty penalties if you don’t pay up. Their scare tactics aim to catch you off guard, when you’re vulnerable and more likely to comply.

Don’t panic, and don’t automatically follow their instructions. SARS would never take drastic action without thorough communication beforehand. They’d send you multiple notices and even offer payment plans if you owe money.

No payment should ever go to a private individual. If anyone, even someone claiming to be from SARS, asks you to make a direct deposit into their personal account, report it immediately. All legitimate payments should be made to the official SARS account, details of which you'll find on your eFiling profile statement.

If you’d like more details, SARS has listed the latest scams with examples on their website. Stay alert during tax season and protect yourself from fraud.

What to do if you come across a tax scam

If someone tries to scam you, report them to SARS by emailing phishing@sars.gov.za, or call their Fraud and Anti-corruption Hotline on 0800 00 2870.