Why did SARS freeze my money?

The long answer

In terms of the Tax Administration Act (TAA), SARS can only freeze the money in your account if it has notified you that you owe it money and that it is making a final demand. It has to give you ten days after the final letter of demand before it can appoint your bank (as a third party) to collect the tax. If you don’t take any action to pay the tax in those ten days, SARS must issue a third party appointment notification (AA88) to the bank or to an employer, which must pay over the tax debt to SARS.

Jean-Louis Nel in a 2020 article for FANews notes that, “Alarmingly, however, there are cases in which SARS has withdrawn funds from taxpayers’ accounts without their being notified. Whether this is a result of deficient communication from SARS or a flagrant disregard for the prescribed tax procedure is not relevant, as the withdrawal can be reversed either way.”

You could contact the bank and SARS Call Centre to confirm that a preservation order has been issued. If the bank cannot produce the preservation order obtained by SARS, you would need to get a lawyer to instruct the bank to “unfreeze” the account or be added as a party to any legal steps you might take.

But perhaps the best thing to do immediately is to contact SARS and ask them for a statement of account. You would need to give them your tax reference number, but if you don’t have that, give them your ID number, and ask them to help you sort it out.

You can contact them at the SARS Contact Centre at:

0800 007277 or contactus@sars.gov.za.

Wishing you the best,
Athalie