Government services

Cash tax payments on the way out

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3 November 2009

The South African Revenue Service (Sars) has begun phasing out the receipt of cash at its branch offices, following an increase in electronic and cheque payments and a steady decline in cash payments over the past few years.

High costs and risks

Given the high costs and risks of handling cash, including providing the necessary security measures in branches and transport arrangements for cash, the relatively low receipts of cash mean it is no longer cost-effective for Sars to accept cash at its branches.

In a statement last week, Sars said the elimination of cash payments would be staggered throughout its 45 branches over the next five months, starting with offices in the North West, Limpopo and Mpumalanga provinces from 1 November 2009.

Offices in the Free State, KwaZulu-Natal and Western Cape will discontinue accepting cash payments from 1 February 2010, while the no-cash payment rule will be effective at all Gauteng-based offices from 1 April 2010.

Cash payments at banks

Taxpayers who still wish to make cash payments to Sars can make pay into Sars' bank account at any branch of Absa, First National Bank, Nedbank or Standard Bank.

"Sars's preferred methods of payment remain via e-filing and internet banking, as these provides both Sars and the taxpayer or trader with an accurate record of payment and are less susceptible to fraud and inaccuracies," Sars said.

The cash hall phase-out process is only applicable to taxpayer services branches. The status quo remains at customs points-of-entry, for the following reasons:

Traders making use of customs points-of-entry are usually entering South Africa from another country, and may therefore have foreign money.
Because banks are not operational around the clock, it would be impossible to expect traders to convert the required customs duty at points-of-entry into bank-guaranteed cheques, as is required for other taxes payable at taxpayer services branches.

SAinfo reporter