Time runs out for tax practitioners

SARS has made an announcement officially recognising five institutes as controlling bodies for the tax profession, namely: SAIT, SAICA, SAIPA, CSAA, and the IAC. However, time is running out for nearly half of the South African tax practitioners, who now only have until 1 July, 2013, to register with one of these recognised bodies, or otherwise run the risk of facing criminal sanctions.

Stiaan Klue, chief executive of the South African Institute for Tax Practitioners (SAIT), which is the largest of the SARS-recognised bodies in terms of a subscriber base, is concerned that the process has taken longer than initially anticipated when President Zuma first promulgated the legislation in December 2012. "Nearly 17 000 tax practitioners now have less than two months to meet the registration requirements, such as complying with professional examinations and, ultimately, registering with a recognised controlling body and SARS before 1 July."

Monthly online compliance examination

In response to the looming deadline, SAIT is offering a monthly online compliance examination for tax practitioners to assist bringing them into the fold before the cut off. "Successful tax practitioners will be registered by the SAIT and SARS, and thereby be allowed to practice after 1 July when the regulation becomes effective," said Ronel de Kock, head of education of the SA Institute of Tax Practitioners. "South Africa is following the international trend in setting professional compliance examinations for tax practitioners in an effort to increase the competence and professional level of tax services available to the public. The online compliance exam is similar to the tax return preparer examination set by the US Inland Revenue Service for US tax practitioners," continued De Kock.

Of the approximate 17 000 tax practitioners who still have to register before the deadline, only 897 have already completed the online professional compliance examination. "The pass rate is acceptable, with 62% of tax practitioners successful on their first attempt and the remainder successful by their third or fourth attempt," said De Kock. "However, these statistics do signal a danger, in that when SARS announces the recognised controlling bodies within the next two weeks, that a significant number of tax practitioners will not be able to meet the professional compliance examinations in time to be able to continue their practice legally after 1 July."

Klue confirmed that the SAIT has submitted a proposal to its Professional Practice Examination Committee to introduce compliance examinations on a weekly basis from 1 June in an effort to accelerate registration and to afford tax practitioners the opportunity to meet the professional compliance examination requirements in time for 1 July.