Take Care With VAT Submissions
In the Johannesburg Specialised Commercial Crimes Court, Anwar Gaffor and his company, Ceiling and Partitioner Installers (PTY) Limited, were charged with three charges of fraud. The accused submitted fraudulent Value Added Tax (VAT) 201 returns to the South African Revenue Service (Sars) from September 9, 2019. “He benefited illegally from VAT refunds totaling over R2.9 million,” Phindi Mjonondwane, a spokesperson for the National Prosecuting Authority (NPA) in Gauteng said.
“The Vendor must submit to a VAT 201 return every second month, accounting for both output and input tax.” “When it comes to administering the amount payable to SARS or refundable to the VAT Vendor, SARS relies on the integrity and honesty of each VAT vendor,” said Mjonondwane.
According to the NPA, Gaffor used fake or fictitious tax invoices purportedly from multiple firms to establish or support VAT refund claims from SARS. The NPA praised the prosecutor, advocate Lebohang Jobo, and the investigating officer, constable Phesheni, for “ensuring that the accused (Gaffor) faces the might of the law for abusing the trust SARS entrusted in him as a VAT vendor, and hopes that the sentence given will deter people from evading tax liability through criminal conduct.”
Gaffor was sentenced to 45 years in jail after being convicted on three charges of fraud. According to Phindi Mjonondwane, a spokesperson for the National Prosecuting Authority (NPA) in Gauteng, the court ordered that the sentences given on charges two and three run concurrently with the sentence on count one, resulting in an effective incarceration term of 15 years.
SARS Commissioner Edward Kieswetter, on the other hand, has expressed gratitude to the NPA and the investigating team within SARS for their cooperation, which resulted in Gaffor’s conviction and punishment. Kieswetter warned taxpayers who knowingly conduct business with SARS with the goal of defrauding the tax collector that the organisation will “relentlessly” pursue those with criminal intent.
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Kindly note this article is intended for general information purposes only and does not constitute accounting, tax, nor regulatory related advice. Should you need advice, please contact one of our practitioners.