Millions of South Africans will be logging onto the SARS eFiling website or visiting their closest branch to complete their tax returns.
“While this is a very busy time for the South African Revenue Service (SARS), it is also a very busy time for scammers,” says Manie van Schalkwyk, the CEO of the Southern African Fraud Prevention Service (SAFPS). “Over the past five years, the SAFPS has noticed a growing trend of tax scams that are targeting individuals who are desperate for cash.”
Beware of auto-assessments
Van Schalkwyk warns the public against taking a SARS auto-assessment at face value. “SARS is increasingly gravitating toward an auto-assessment system for qualifying taxpayers. This means SARS has already done the tax return on behalf of the individual. They then either qualify for a rebate or pay money back to SARS.”
While this is legitimate, he warns that scammers have also got on board with this trend. “Scammers are contacting taxpayers impersonating SARS. When targeted taxpayers log on to complete their auto-assessment, they are redirected to a proxy website where scammers will use the information they fill in on the form. The scammers will even produce a fake proof-of-payment document indicating that a rebate has been paid into the taxpayer’s bank account.”
Additional SARS scam
SARS also warns the public of an additional scam perpetrated by scammers impersonating SARS officials.
Scammers are posing as SARS, luring taxpayers into a trap with an Outstanding Tax Payment notice. The notice, sent via email, replicates SARS’ logo and formatting and warns taxpayers that they will be unable to file their tax return for the 2024 tax season until they pay an outstanding amount attached to their tax profiles.
The scammers warn that failing to pay the amount by a specific date will result in fines, penalties and potential assessments on a taxpayer’s affairs, which could result in conviction and prison time.
“As you can see, scammers are using sophisticated tactics,” warns Van Schalkwyk, who adds that before taxpayers act in a panic, they should contact SARS and clarify the situation before taking action.
Additionally, SARS has a comprehensive list of the scams.
Spotting a scam
While a scammer’s work is opportunistic in nature, Van Schalkwyk urges the public not to become complacent. Scammers are well-educated in current fraud tactics and are part of large syndicates that make a living from targeting individuals. Because of this, scams are becoming increasingly difficult to identify.
The following points were made by SARS in a recent media article, which is supported by Van Schalkwyk. To avoid getting caught by these scammers, taxpayers need to pay attention to the following red flags:
- Be wary if the auto-assessment notice does not come from a @sars.gov.za address. The email should not come from a sub-domain (e.g. @SARS.Assessment.gov.za). If it does, do not open it.
- The auto-assessment email may contain hostile and threatening language.
- Be wary if the auto-assessment notice is not directly addressed to you or your business and does not contain your unique tax number.
- Be wary if the email demands an urgency on your part to avoid penalties.
- Be wary if the notice contains spelling and grammar mistakes. This is an immediate red flag, but is becoming less prevalent as generative AI makes writing correspondence on behalf of users easier.
- Be wary if the email contains a strange link that you need to click on.
Immediately contact the authorities if:
- You receive this type of correspondence, have already filed your tax return, and do not owe SARS anything.
- The payment directive refers to specific bank account numbers and not SARS–approved bank references. To make SARS payments easier, all banks already have SARS banking details under the public recipient details. Taxpayers won’t have to enter the number. Rather, they can select the relevant account & add their payment reference number.
A major tool
How do we combat this? Van Schalkwyk points out that the SAFPS launched Yima in response to the growing need for a proactive approach to fraud prevention.
“Yima is a one-stop-shop website for South Africans to report scams, secure their identity and scan any website for vulnerabilities related to scams. They can also educate themselves on how to identify a scam. These tools will enable consumers to surf the Internet, access key products such as online banking and money transfers more confidently, and empower them to make informed decisions in their daily lives. These are just some exciting elements South Africans can access through the site for free.”
Alerting authorities
The website’s main element will be the ability to report a scam incident or any suspicious activity to the SAFPS. This suspicious activity includes fake or suspect-looking online shopping and investment websites or portals, and instances where the user has received phoney banking information. These reports will be collated and shared with law enforcement.
Users are provided with a scam hotline (083 123 7226) to report a fraud incident directly to their banks, retailers or insurance companies via a single number.
Thus, users only need to remember one number rather than search for each institution’s contact numbers online.
Additionally, Yima users will have access to the consumer products and services offered by the SAFPS.
Image credit: starline/Freepik