Elightening - why SARS's increased focus on trusts - 11 May 2026

Fact:

SA relies on a narrow tax base, with only 13.2% of the Personal Income Tax population producing more than 50% of SA's total tax collections. Not sustainable!

Challenge:

This presents a concentration risk for SARS. They cannot squeeze more tax from a stagnant tax base, with many people not even paying tax as they fall below the tax threshold.

SARS's focus (as continued by SARS's new Commissioner, Dr Johnstone Makhubu): To broaden the tax base and zoom in on provisional taxpayers, especially those who use trusts and receive income. It will be done by focusing on non-compliance. The recent introduction of penalties for non-compliance demonstrates SARS's plan.

The risk for trustees:

SARS is working with other government agencies to exchange data and is tracking transactions and bank accounts as they interact within the financial system. According to Makhubu, "Data is the lifeblood of a tax administration, and we want to use data to zone into trusts and ensure they are as compliant as they can be". He added that "if compliance still does not come through, then we have to responsibly enforce, and we do intend to heighten our integrated enforcement going forward".

Call to action:

Trustees, accountants and other trust service providers should take SARS seriously and treat the trust as a vehicle that requires much more detailed compliance and paperwork than any other taxpayer. Avoid being caught by SARS. Please speak with us about what is required and how to remain compliant easily throughout.