Who needs to submit the audit certificate?
- An approved organisation conducting a combination of Public Benefit Activities (PBA’s) from Part I and Part II of the Ninth Schedule
- A conduit Public Benefit Organisation (PBO) funding other PBO’s, institutions, boards or bodies organisation conducting a combination of PBA’s from Part I and Part II of the Ninth Schedule
Who is exempt?
- An approved organisation conducting only PBA’s from Part II of the Ninth Schedule
- A conduit PBO funding other PBO’s, institutions, boards or bodies organisation conducting only PBA’s from Part II of the Ninth Schedule
Why does an audit certificate need to be issued?
- An approved organisation is only allowed to issue a Section 18A (S18A) certificate only to the extent that the donation will be used to carry on PBA’s in terms of Part II of the Ninth Schedule.
- Accordingly there is a risk that those approved organisations that conduct activities in terms of Part I and Part II of the Ninth Schedule may be issuing S18A certificates incorrectly.
Who can the audit certificate be obtained from?
- The Income Tax Act does not prescribe who must issue an audit certificate.
- It is expected that the individual must be independent and suitably qualified.
- Typical individuals that can provide this service include:
- Auditor General
- Registered Auditor
- Independent Reviewer
When do I submit the audit certificate?
Only when SARS submits a request to an organisation after the income tax return has been submitted.
What is the implication of non-submission of an audit certificate?
A person who wilfully and without cause fails or neglects to submit a return or supporting documents to SARS (supporting documents includes the audit certificate) which is required to be submitted is guilty of an offence and on conviction is subject to a fine or imprisonment for a period not exceeding 2 years.
How long should I retain the certificate?
The audit certificate (either electronic or hardcopy) must be retained for 5 years from date of submission of the income tax return for the year of the assessment to which the certificate relates.