Insights

NEWSFLASH – SARS Financial Year End

by | Mar 16, 2026 | Advisory Services

Expect Aggressive Debt Collection

As SARS approaches its financial year-end on 31 March 2026, taxpayers should expect a significant escalation in debt collection activity. Recent published data shows that SARS is under intense pressure to recover outstanding tax debt, and is already taking a more assertive approach with both individuals and corporates.

Key Reasons for the Aggressive Collection Drive

  • SARS has confirmed that as at December 2025, the undisputed tax debt book stands at approximately R523 billion.
  • Between November and December 2025, SARS recorded a dramatic increase in personal income tax debt, rising from R88.3 billion to R115.5 billion, a jump of R27.2 billion in one month. This points to growing non compliance by individuals, which SARS has publicly stated it will pursue aggressively.
  • SARS is preparing for collections – According to BusinessTech and Polity, SARS has spent the past months:
    • reconciling taxpayer accounts;
    • matching third party data, and;
    • preparing enforcement actions, including freezing bank accounts and issuing Final Demand notices.

National Treasury’s monthly published debt collection data confirms that SARS has collected R79.39 billion from outstanding tax debt between April 2025 and January 2026.

This places SARS on track for the baseline target of R100 billion by March 2026.  However, SARS will likely miss the higher R135 billion target, increasing pressure to intensify collections in February and March.

With SARS under pressure to close the year end collection gap, clients can expect:

  • More Final Demand letters;
  • More account freezes and third party appointments (banks, employers);
  • Faster escalation to legal recovery processes;
  • Reduced tolerance for late or outstanding returns;
  • Aggressive follow up on VAT, PAYE, PIT, and CIT arrears.

We strongly advise all clients to review all outstanding tax balances immediately, even small balances may now trigger enforcement.

Engage us early if you receive a SARS notice and do not ignore:

  • Final Demand letters;
  • Third party notice warnings;
  • Penalty assessments;
  • Requests for verification.

Early intervention prevents escalations.

Our tax teams – michellet@sentineltrust.co.za, janinel@sentineltrust.co.za, jacoriu@sentineltrust.co.za can support you with:

  • Payment arrangements and debt compromise applications;
  • SARS engagement and dispute resolution;
  • Ensuring returns are up to date to avoid enforcement action.