South Africa: Draft notice for public comment on revised CRS penalty framework
SARS encourages relevant stakeholders to submit comments by June 27, 2025
The South African Revenue Service (SARS) on June 11, 2025, issued a draft new penalty notice for public comment—set to be published under section 210(2) of the Tax Administration Act, 2011 (TA Act)—implementing a stricter enforcement framework for the common reporting standard (CRS) compliance.
The new penalty notice will replace Public Notice No. 193 (the current CRS penalty notice) of March 3, 2017. Under the current framework, SARS is required to notify a defaulting financial institution of its non-compliance with due diligence requirements once identified during reviews. The financial institution is then given a remedial period of 60 business days before a penalty is imposed. This penalty is a fixed amount that increases monthly by the same amount for up to 36 months until the non-compliance is resolved. Feedback from the OECD’s AEOI Peer Reviews of 2023 and 2025 (to be published in July 2025), along with internal analysis by SARS, reveals that the current penalty framework is not an effective deterrent for CRS non-compliance, as it allows financial institutions to delay compliance until notified by SARS.
Once in force, the new penalty framework will eliminate the issuance of prior notice and the remedial period of 60 business days, ensuring the immediate imposition of administrative penalties upon detection of any CRS non-compliance. This approach aligns with the frameworks followed for other administrative penalties under the TA Act. However, the framework will still allow financial institutions to submit remittance requests, objections, or appeals against penalties.
SARS encourages relevant stakeholders to submit comments by June 27, 2025, to acollins@sars.gov.za.
Read a June 2025 report prepared by the KPMG member firm in South Africa