Zuko Komisa
- The South African Revenue Service (SARS) has temporarily withdrawn administrative penalties and final demand notices for outstanding trust tax returns.
- Tax experts warn that this is a brief grace period rather than a permanent exemption from compliance obligations.
- Trustees are urged to regularise outstanding returns and beneficial ownership records before strict enforcement resumes.
The South African Revenue Service (SARS) has provided temporary relief to thousands of trustees by withdrawing certain administrative penalties and final demand notices issued for outstanding Trust Income Tax Returns (ITR12T).
Under this reprieve, previously issued final demands should be disregarded, and associated penalties will be reversed where applicable.
However, experts warn that this is a strict grace period rather than a policy shift. Over the past two years, SARS has intensified its focus on trusts through enhanced beneficial ownership reporting and stricter monitoring.
Compliance remains mandatory for all trusts, even those that are completely dormant.
Sidney Fletcher, Senior Manager at Tax Consulting South Africa, emphasised that trustees must act quickly before the revenue service issues revised final demands:
“While many trustees may view this as a reprieve, it should not be mistaken for an exemption from their compliance obligations. In fact, SARS has made it clear that this is a temporary pause in enforcement, creating a limited opportunity for trustees to regularise their affairs before penalties are reintroduced.”
Failing to utilise this window could expose trustees to recurring and costly penalties. Modern trust compliance has become highly technical, requiring careful management of asset vesting, loan account implications, and tax residency.
Trustees are urged to use this second chance proactively to bring their tax affairs fully up to date.
For more insights into navigating the evolving compliance landscape, listen to a recent conversation on Kaya Biz with Gugulethu Mfuphi on the Tax Season 2026: Must-Knows with Commissioner Dr. Johnstone Makhubu. In this conversation, the SARS Commissioner unpacks the 2026 Filing Season, explaining how the enhanced risk engine, auto-assessments, and a more targeted audit environment will affect taxpayers this year.
Listen to the full conversation here:
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