What is a tax clearance certificate?
A tax clearance certificate is a certificate that confirms that you are in good standing with the South African Revenue Service (SARS). A tax clearance certificate may also be obtained for foreign investment and immigration purposes however this article concentrates on the tax clearance applications for tenders.
Who needs a tax clearance certificate?
Anyone intending to do business with a government institution or body, in certain instances it is also required by companies as part of their procurement process. Anyone who needs to tender or intends to apply for a business loan with the South African government needs one.
How does one obtain a tax clearance certificate?
You need to contact your local SARS office; they will provide you with a tax clearance form (TCC001). Alternatively it can be downloaded from the SARS website www.sars.gov.za .
How long does it take to obtain one?
Again you need to contact SARS on this one, processing times vary from 5 to 21 working days.
Can I apply for one even if I have not registered my business with CIPC?
No, a tax clearance certificate relates only to registered businesses.
Is it compulsory to apply for one?
No however if you intend to conduct business with government and with some large companies, it will be required.
My business is not registered for Income Tax, can I still obtain tax clearance?
No you cannot, you must first submit a business Income Tax application. The forms are available on the SARS website (IT77C) or alternatively at your nearest SARS branch. SARS requires a completed IT77C, certified ID copies of all directors and the documents of incorporation of the company (i.e. the registration certificate) in order to process the application, the process takes 21 working days.
How much does it cost?
The service is free if you contact your local SARS branch, however you may utilise the services of an accountant if you so desire, you will be charged accordingly.