The regulation of tax practitioners came a step closer last week, when the South African Revenue Service (SARS) named the organisations with disciplinary powers to which tax practitioners will be expected to belong if they want to submit tax returns on your behalf after July 1 this year.
However, two of the organisations have raised concerns about whether tax practitioners have sufficient time in which to meet the membership criteria of the organisations they need to join in order to meet the July deadline.
At the end of last year there were 17 000 tax practitioners not registered with any organisation – about half of the 34 000 practitioners who help taxpayers submit their returns.
The five organisations named as “controlling bodies” for tax practitioners this week are: the South African Institute of Chartered Accountants (Saica), the South African Institute of Professional Accountants (Saipa), the South African Institute of Tax Practitioners (Sait), the Institute of Accounting and Commerce and the South African Institute of Chartered Secretaries and Administrators.
The Tax Administration Act states that tax practitioners can also, from July 1, be members of the Independent Regulatory Body for Auditors, the Law Societies or the General Council of the Bar. Members of the Financial Planning Institute can now obtain affiliate membership of Sait.
While most of the organisations cater for particular professionals, such as chartered accountants, chartered secretaries, attorneys or advocates, Sait offers a home to tax practitioners with a variety of qualifications, and Saipa is offering membership to tax practitioners who are not accountants but have appropriate experience in tax.
Stiaan Klue, chief executive of Sait, says that since late last year only 849 practitioners have completed Sait’s compliance examination.
Saipa was unable to say how many new members had joined its ranks, but warned that time was short and that, to register, practitioners would need to write its professional evaluation exams
Faith Ngwenya, the technical and standards executive at Saipa, said many practitioners may not even be aware that they need to register. She says taxpayers should check that their practitioners are registered, as many may not even be aware of the need to register and may soon find themselves out of business.
The Tax Administration Act was amended in 2011 to force tax practitioners to register with a controlling body by July this year in order to ensure that tax practitioners are appropriately qualified and that you and SARS are able to complain about a practitioner who, for example, fails to submit your return.
National Treasury and SARS said in motivation of the amendment that they had long been concerned that you could be advised by a practitioner without any qualifications or experience and who is not governed by a professional code of conduct.
Treasury and SARS are also concerned that there are not enough controls to ensure that you receive advice consistent with the tax legislation.
The Tax Administration Act obliges controlling bodies to:
* Require their members to have minimum levels of qualification and experience;
* Provide their members with continuing professional development (CPD);
* Have a code of ethics and conduct; and
* Have a disciplinary procedure to deal with members who contravene their code.
The bill says that in order to be recognised by SARS, a professional association must have at least 1 000 members, or must attract at least 1 000 members in its first year of existence.
In response to the looming deadline, Sait is offering a monthly online compliance examination for tax practitioners to assist them in getting registered before the deadline and hopes to offer this course weekly in June.
SARS says that the registration of tax practitioners with a recognised controlling body is the first phase of the regulation of tax practitioners. The second phase involves the establishment of an independent regulatory board for tax practitioners and will begin with a review of the success or otherwise of the first phase 18 months after its implementation.