What is a Public Officer?
The Tax Administration Act 28 of 2011 stipulates that all companies are required to appoint a Public Officer. A Public Officer serves as the representative taxpayer for a company, meaning that this person is, effectively, the face of the company for tax purposes. All actions carried out in this person’s capacity as a Public Officer are deemed to have been done by the company.
A Public Officer is an individual who is residing in South Africa and must be a registered taxpayer with SARS. The individual representative who is approved by SARS must be a senior official of the company. Should the company not have a senior official residing in South Africa, then any suitable person can fulfil this role.
What are the duties/the role of a Public Officer?
The Public Officer is responsible for all acts, matters or things relating to the company under the various Tax Acts, including:
- Attending to all tax registrations e.g.: for VAT, Payroll taxes and Customs and Excise;
- Attending to all tax matters of the entity, including submission of the tax returns for VAT, employee’s tax, employee reconciliations, income tax, dividends tax and provisional taxes;
- Being responsible for the timeous payments of taxes due to SARS; and
- Notifying SARS of any change of the registered particulars e.g.: registered address, year-end change, name change, banking details.
When must a Public Officer be appointed?
Companies are required to appoint a Public Officer within one month after they begin to conduct business or acquire business premises in South Africa. Should your company fail to do this, the Commissioner will designate a director, member (in respect of close corporations) or the company secretary as Public Officer.
Where there is a change of Public Officer, the company must notify SARS within 14 days of the change being implemented. SARS may impose administrative penalties on a company, should the company fail to notify SARS of a change of Public Officer
How is a Public Officer appointed?
A Public Officer is classified by SARS as a “registered representative.” A registered representative is a person who is appointed with full rights to act on behalf of another legal entity.
If a legal entity has more than one registered representative, then one has to be nominated as the official “representative person” with SARS. Please note that the registered representative must be registered with SARS.
If more than one registered representative is recorded/listed at SARS, one person must be nominated as the “official” representative to be updated on the system.
The documentation that SARS will require to register the Public Officer is as follows:
- The original and a copy of an Identity document (ID)/temporary ID/passport/driver’s licence for the registered representative;
- Copy of proof of residential address of the registered representative;
- Letter of appointment authorising the appointed representative to act as a Public Officer on behalf of the company or minutes of the meeting where the resolution was made that the appointed representative should act as the Public Officer of the company and;
- Certificate of Registration of the Company or Company’s Memorandum of Incorporation (MOI) or CK1/CK2.
What happens if a company fails to appoint a Public Officer?
Administrative penalties may be levied by SARS against any company that’s fails to:
- Appoint the required Public Officer;
- Elect the place for service or delivery of notice;
- Keep the office of Public Officer constantly filled;
- Maintain the place for service or delivery of notice; or
- Notify SARS of any change of Public Officer or place for service or delivery of notice.
What liability attaches to a Public Officer?
The Public Officer is subject to penalties for “the company’s defaults” and, as a “representative taxpayer” risks further liability in terms of the Tax Administration Act. For example, Public Officers risk liability for tax due to SARS to the extent that they concluded transactions or had control of income or received income from the company. They are also personally liable if tax is due to SARS and they divert or dispose of monies or assets which could have been used to settle the tax. There are differences of opinion in legal circles as to exactly how far these risks of personal liability go, but they are real risks.