We are receiving messages from many client about their being deluged with SARS notices on penalties being levied, and rapidly escalating interests, even for long-dormant organisations.

SARS is invoking section 210 of the Tax Admin Act which allows it to impose monthly penalties for non-compliance, for as long as the non-compliance continues.

To our mind, the reasons that this is occurring now are:

• SARS has been on a major push to increase their tax recoveries. These penalties, the interest which builds up on them and then the actual tax which may be paid because of the need to stop the penalties building up, is a big part of that plan;
• The increased granularity, interoperability and efficiency of the SARS systems have created ability and capacity to impose these penalties and chase down the non-compliers.

The minimum penalty amount is R250 per month, even if there is no tax owed, but returns have just not been filed.

SARS embarked on a rollout to chase down non-compliant trusts from 4 May 2026, and the following is from their website announcement: 

2 April 2026 – On 27 March 2026, a public notice was issued listing the non-submission of income tax returns by Trusts as an incidence of non-compliance subject to an administrative non-compliance penalty under section 211 of the Tax Administration Act, 2011 (TAA). Administrative penalties may be imposed on taxpayers who fail to comply with an obligation under a tax Act. The penalties are designed to encourage compliance, applied consistently, and may recur monthly until corrected.

From 4 May 2026 SARS will issue a penalty assessment notice (AP34) to notify taxpayers of administrative non-compliance penalties that have been imposed for non-compliance with regard to outstanding trust income tax returns. The penalty assessment notice will reflect imposed penalties, outstanding income tax returns for which tax periods, and corrective measure to be followed to prevent recurring penalties. Taxpayers are also advised to submit a request for remission if they do not agree with the penalty imposition. This penalty will apply to trusts with outstanding income tax returns (ITR12T) for tax periods from 2024 onwards. For more information, see the updated Guide to submit a dispute via eFiling.

Kindly note that the previous Guide called ‘How to dispute Administrative Penalties via eFiling’ has been incorporated into the above guide.

Also see our step-by step video on How to file a Request for Remission for Trust on eFiling.

Following an outcry from dormant trusts who received notices and penalties, SARS published the following (with my emphasis):

9 April 2026 – The South African Revenue Service (SARS) is reminding all trusts registered in South Africa that, in terms of tax legislation, they are required to submit Income Tax Returns for every year of assessment. This obligation applies even where a trust had no economic activity during the relevant year.

Where a trust is no longer being used for its intended purpose, trustees are encouraged to formally terminate the trust through the Office of the Master of the High Court (Master). Once the Master has issued a written confirmation of termination, trustees should request SARS to deregister the trust for income tax purposes. This process assists in preventing the unnecessary imposition of administrative penalties arising from ongoing non-compliance.

 Although the Trust Property Control Act does not expressly prescribe a deregistration process, the Chief Master issued a directive in 2017 to provide clarity on the procedure to be followed. Importantly, trustees must first establish and regularise the trust’s tax compliance status with SARS before approaching the Master for termination.

Trustees act as representative taxpayers of a trust in terms of the Income Tax Act and are required to ensure that all outstanding tax returns, payments, and related tax obligations are fully resolved prior to requesting termination at the Master and deregistration at SARS. In some instances, SARS may owe a trust a tax refund. Once a trust has been terminated by the Master, it legally ceases to exist, as does the Office of Trusteeship. In such circumstances, SARS is unable to lawfully process or pay any refunds due to the trust.

 Trustees are therefore urged to follow the correct sequence

1. 1. first confirm and regularise the trust’s tax affairs with SARS, and
2. 2. only thereafter proceed with termination at the Master.

 This approach safeguards compliance and protects trustees from potential personal liability. This also ensures that any refunds due to the trust can be processed timeously.

 Originally puplushed in ngoLAWBrief, Q1 2026.