190. Refunds of excess payments
(1) SARS must pay a refund if a person is entitled to a refund, including interest thereon under section 188(3)(a), of-
[Words preceding paragraph (a) substituted by section 60 of Act 23 of 2015 effective on 1 October 2012]
(a) an amount properly refundable under a tax Act and if so reflected in an assessment; or
(b) the amount erroneously paid in respect of an assessment in excess of the amount payable in terms of the assessment.
(2) SARS need not authorise a refund as referred to in subsection (1) until such time that a verification, inspection, audit or criminal investigation of the refund in accordance with Chapter 5 has been finalised.
[Subsection (2) substituted by section 34(a) of Act 24 of 2020]
(3) SARS must authorise the payment of a refund before the finalisation of the verification, inspection, audit or criminal investigation if security in a form acceptable to a senior SARS official is provided by the taxpayer.
[Subsection (3) substituted by section 34(b) of Act 24 of 2020]
(4) An amount under subsection (1)(b) is regarded as a payment to the National Revenue Fund unless a refund is made in the case of—
(a) an assessment by SARS, within three years from the later of the date of the assessment or the erroneous payment;
[Paragraph (a) amended by section 21(a) of Act 22 of 2018]
(b) self-assessment, within five years from the later of the date the return had to be submitted or, if no return is required, payment had to be made in terms of the relevant tax Act or the erroneous payment was made; or
[Paragraph (b) amended by section 21(b) of Act 22 of 2018]
(c) an erroneous payment claimed by a taxpayer within the period referred to in paragraph (a) or (b), but not paid by SARS within the period.
[Paragraph (c) added by section 21(c) of Act 22 of 2018]
[Subsection (4) substituted by section 53 of Act 44 of 2014 and by section 60(1)(b) of Act 23 of 2015]
(5) If SARS pays to a person by way of a refund any amount which is not properly payable to the person under a tax Act, the amount, including interest thereon under section 187(1), is regarded as an outstanding tax debt from the date on which it is paid to the person.
[Subsection (5) substituted by section 71 of Act 39 of 2013 effective on 1 October 2012 and by section 60 of Act 23 of 2015 effective on 1 October 2012]
(5A) If a person who carries on the ‘business of a bank’ as defined in the Banks Act, 1990 (Act No. 94 of 1990), holds an account on behalf of a client into which an amount referred to in subsection (5) is deposited, reasonably suspects that the payment of the amount is related to a tax offence, the person must immediately report the suspicion to SARS in the prescribed form and manner and not proceed with the carrying out of any transaction in respect of the amount for a period not exceeding two business days unless-
(a) SARS or a High Court directs otherwise; or
(b) SARS issues a notice under section 179.
[Subsection (5A) inserted by section 60 of Act 23 of 2015 and substituted by section 28 of Act 13 of 2017 effective on 18 December 2017]
(6) A decision not to authorise a refund under subsection (1)(b) is subject to objection and appeal.
[Subsection (6) substituted by section 60 of Act 23 of 2015 effective on 8 January 2016]