When dealing with a sales transaction subject to VAT, it is important to obtain insight into the Seller’s VAT compliance background - the reason being that SARS is on a war path to put a stop to attempts by taxpayers to avoid paying VAT and/or transfer duty and personal tax. SARS has implemented measures to check a Seller’s compliance records to determine whether the Seller is guilty of not paying timeously, having outstanding payments or even not filing returns timeously. If any of the mentioned circumstances exist, SARS may require the Seller to take certain steps before issuing the transfer duty exemption, such as:

• Resolve outstanding obligations; or
• Provide security for VAT payments of current transaction; or
• Instruct the transferring attorney to undertake to pay VAT directly to SARS from the proceeds of the sale within 5 days of registration.