Are you keeping your tax records in line with the law? For businesses in South Africa, it’s essential to comply with the Tax Administration Act (Act 28 of 2011) read with Government Notice 787, which outlines the specific requirements for storing tax records, books of account, and related documents.
How long must records be kept?
| Taxpayer type | Period it needs to be kept |
| A person who has submitted a return | Five years: counting from the date of submission of a return until the last day of the period. |
| A person is required to submit a return but has not complied. | Five years: After the end of the five-year period, indefinitely until the return is submitted. |
| A person who is not required to submit a return but has, during a tax period, received income, has a capital gain or loss or engaged in any other activity that is subject to tax or would be subject to tax but for the application of a threshold or exemption. | Five years or until the audit is concluded, whichever occurs first. |
| A person who has lodged an objection or appeal against an assessment or decision under the TAA. | Five years or until the disputed assessment or decision becomes final, whichever occurs first. |
| A person who has been notified or is aware that the records are subject to an audit or investigation. | Until the audit or the investigation is concluded. |
In terms of Section 30(1) of the Act, it’s essential to keep these records in their original form, organise them systematically, and store them securely, whether in physical or electronic form.
In the following instances you must request SARS for authorisation to deviate from the above-mentioned requirements:
- Where records are to be kept in a different form; and/or
- Where the electronic records are kept at a place physically located outside of South Africa
In both instances a senior SARS official may, subject to conditions, in accordance with section 30(2) of Tax Administration Act, authorise such form if acceptable or authorise such location outside of South Africa, if acceptable
Local storage of electronic tax records
A significant amendment introduced by Government Notice 787 plays a crucial role in storing electronic records. It requires all such records to be stored within the borders of South Africa. This means that if a company or tax professional handling taxes for companies, trusts, or individuals utilises electronic services for maintaining their records, the servers hosting these electronic records must be physically located within the Republic of South Africa. This stipulation ensures that sensitive tax data remains within the jurisdictional boundaries of South Africa, facilitating easier regulatory compliance and oversight by the South African Revenue Service (SARS).
Storage and protection of tax records
Compliance with these requirements is not just a legal obligation but a crucial step towards ensuring the security and integrity of your tax records. By storing your records within South Africa, you can benefit from a clearer legal framework regarding data protection and privacy, thereby enhancing your financial operations’ overall trust and reliability. This local storage requirement underscores the importance of understanding and integrating national regulatory standards into your company’s data management and IT infrastructure strategies, giving you the power to control and protect your data.
Leveraging Microsoft Azure for tax record storage
Microsoft Azure, with its established data centres in South Africa, specifically in Johannesburg and Cape Town, offers a significant advantage to South African companies seeking to store sensitive tax data securely. These local data centres ensure that data residency requirements are met, which is crucial for compliance with South African data protection laws, such as the Protection of Personal Information Act (POPIA). Keeping your tax records and data within the country can avoid legal and regulatory complications from cross-border data transfers. Additionally, the proximity of these data centres reduces latency, enhancing the performance of your cloud services and applications, which is critical for real-time processing and reporting of tax-related information.
Advanced tax record storage security measures
Moreover, Microsoft Azure’s robust security measures, including advanced threat protection, encryption, and stringent access controls, provide a fortified environment for sensitive data. Azure’s compliance with international standards further ensures that data is handled according to globally recognised security practices. This level of security and compliance gives South African companies peace of mind, knowing their tax data is protected against breaches and cyber-attacks.
Supporting disaster recovery and business continuity
Azure data centres in South Africa also support disaster recovery and business continuity plans. Azure’s multi-region capabilities allow companies to replicate their data across different locations, ensuring their tax information remains accessible and secure even during a local failure or disaster. This comprehensive data protection and management approach underscores Microsoft’s commitment to supporting South African businesses, providing them with reliable, secure, and compliant cloud solutions tailored to their needs.
Why choose Konsise for tax record storage
Adhering to the Tax Administration Act’s requirements for tax record storage is a legal necessity for South African companies and a critical component of effective data management and security.
Konsise stands apart from other South African tax software platforms by offering an unparalleled level of security that sets the standard in the industry. Hosted within the Microsoft Azure platform, tax data is prioritised with a multi-layered security approach that boasts industry-leading certifications and compliance. Employing first-class security features, including encryption, firewalls, and robust access controls, Konsise provides maximum protection for your most sensitive tax data.
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein.
