SARS not allowed to monitor your bank transactions in real time
"SARS does not have a real-time bank-monitoring system and no such system has been announced."
Online reports alleged that the South African Revenue Service (SARS) will implement a new real-time monitoring system that would be able to detect interest-bearing transactions, capital gains, and digital wallet activities almost immediately.
According to videos and other online reports, this system would be able to track activity from banks and other financial platforms in real time as a way to detect undeclared income, reduce the need for manual audits, and help address the tax gap.
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It was claimed that this update was aimed at cracking down on tax evasion by small businesses and freelancers who channel business income through private accounts.
Side-hustle earnings, such as those from e-hailing drivers, influencers, online sales, undeclared rental income, and cash-based business earnings, were said to be affected.
However, after speaking to André Bothma, Senior Tax Advisor at TTT Financial Group, Breakfast with Martin Bester can confirm that no such system is currently in place.
"SARS does not have a real-time bank-monitoring system, and no such system has been announced, legislated, funded, procured, or built. Banks only supply annual third-party data, which SARS has used for years. Even SARS's VAT-modernisation programme is still years away from full rollout. The idea of real-time income-tax monitoring isn’t based on law, policy, or technology; it is pure imagination," said Bothma.
No real-time SARS monitoring of personal bank accounts
Bothma explained that there is no law, no SARS announcement, no SAIT guidance, and no amendment to the Tax Administration Act that allows SARS to monitor private bank accounts in real time.
What SARS actually uses: annual third-party data
"Banks and financial institutions already provide SARS with annual information such as interest earned, investment data, and certain capital-gains events," confirmed Bothma
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This is not real-time and has existed for years.
SARS's comments about "data integration" or "AI compliance" refer to using this existing yearly data more effectively, not live bank tracking.
Why the confusion arises: VAT modernisation
SARS is currently modernising the VAT system, where real-time or near-real-time e-invoicing could be possible.
However, this project is years away from full rollout, because:
- no mandatory e-invoicing standard exists,
- no universal data format has been published,
- small businesses all use different accounting systems, and
- no national compliance roadmap is in place.
"Even VAT real-time integration will take significant time to implement, which makes the idea of real-time income-tax bank monitoring even less plausible," said Bothma.
Why real-time monitoring is legally impossible right now
A real-time monitoring system would require that at least four major laws be amended:
- the Tax Administration Act,
- the Banks Act,
- the Financial Intelligence Centre Act, and
- the Constitution’s privacy protections.
"None of these amendments exist or have even been proposed."
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