SARS Compliance for South African Government Tender Eligibility

Tax Types and Filing Obligations

A company registered with SARS must file and pay all taxes applicable to its operations. The core tax obligations for most companies are: Income Tax (ITR14 — annual return, due within 12 months of the financial year end), VAT (VAT201 — monthly or bi-monthly depending on category), PAYE, UIF, and SDL (EMP201 — monthly, due by the 7th), and employer reconciliations (EMP501 — bi-annual in August and February). Provisional tax (IRP6) is payable in two instalments (six months and year-end) by companies that are not subject to the standard assessment cycle.

SARS categorises taxpayers by risk and compliance profile. Businesses that file and pay consistently and on time are assigned lower-risk profiles and receive faster refund processing. Businesses with a poor compliance history are subject to more frequent audits, verification requests, and compliance interventions. For tender purposes, even a single outstanding return or unresolved audit query can render a business non-compliant on the TCS system, costing them tender contracts.

• ITR14 (annual corporate tax return): due within 12 months of financial year end
• VAT201 (monthly/bi-monthly): due on the 25th of the month following the tax period
• EMP201 (PAYE/UIF/SDL): due by the 7th of each month
• EMP501 (employer reconciliation): August (interim) and February (annual)
• IRP6 (provisional tax): 6-monthly instalments
• All returns and payments submitted via SARS eFiling at www.sars.gov.za

Common SARS Compliance Issues for Tender Applicants

The most common SARS compliance issues that cause tender applicants to fail TCS verification are: failure to submit ITR14 for the current or prior years, unresolved PAYE liability from prior periods, VAT returns in arrears, outstanding audit assessments under objection that have not been suspended, and banking detail mismatches that delay refund processing and create apparent outstanding balances. Businesses must address all these issues proactively rather than waiting for a tender deadline to discover a non-compliance problem.

SARS eFiling provides a Compliance Dashboard under the 'My Compliance Profile' section that lists all outstanding returns, assessments, and payment obligations. Check this dashboard regularly. If you receive an audit or verification letter from SARS, respond within the required timeframe (usually 21 days) to avoid automatic assessments that create additional debt. Engage a registered tax practitioner if you are uncertain about how to respond to SARS correspondence, as errors in responses can worsen your compliance position.

• Check SARS Compliance Dashboard in eFiling regularly
• Respond to all SARS audit and verification requests within the 21-day window
• Ensure ITR14 is submitted for all financial years — including recent years
• Verify that PAYE and VAT payments are allocated correctly against the correct periods
• Keep eFiling banking details current to receive refunds without delays

Resolving Non-Compliance and Obtaining TCS

If your SARS compliance status is non-compliant, the first step is to identify all outstanding obligations through your eFiling Compliance Dashboard or by requesting a Statement of Account. Submit all outstanding returns immediately — late returns with appropriate supporting documents may reduce penalties under SARS's Voluntary Disclosure Programme (VDP) or through a request for reduction of penalties under Section 213 of the Tax Administration Act 28 of 2011. Once all returns are filed, contact SARS to enter a payment arrangement if you cannot pay the outstanding debt in full.

SARS payment arrangements are formalised under Section 167 of the Tax Administration Act. Once a payment arrangement is in place and the first payment made, SARS will typically update the TCS status to compliant within 24 to 48 hours. It is critical to honour every instalment of the arrangement — a single default results in the arrangement being cancelled and TCS status reverting to non-compliant immediately. Keep all correspondence related to the payment arrangement as evidence of compliance efforts for tender submission purposes.

• Submit all outstanding returns before requesting TCS
• Apply for Voluntary Disclosure Programme (VDP) for serious prior non-compliance
• Enter a Section 167 payment arrangement if debt cannot be settled in full
• TCS status typically updated within 24–48 hours of arrangement approval
• Never default on a payment arrangement — it immediately invalidates TCS
• Contact SARS call centre: 0800 00 7277 | eFiling: www.sars.gov.za

Frequently Asked Questions

Related Guides

• Tax Clearance Certificate for Tenders
• VAT Registration for Tenders
• UIF Compliance for Tenders
• CSD Compliance Requirements