SARS is tightening tax debt collection.

Ignore outstanding tax and you may face more than reminders and penalties. SARS can recover certain tax debts through third parties — your employer, your bank, or anyone else who holds or owes you money.

What is a third-party appointment?

It's a legal collection process. SARS sends a notice to a third party that holds or owes money for a taxpayer — including a salary, wage or pension — and requires it to pay that money to SARS instead. The power is in section 179 of the Tax Administration Act. When the notice goes to an employer, SARS calls it an AA88.

Who SARS can appoint

• Your employer: SARS may require deductions from your salary
• Your bank: Funds in your account may be paid to SARS
• Other institutions: Investment managers, insurers, attorneys, or anyone else who owes you money

When SARS issues one

SARS's employer guide sets out four conditions. There is an overdue balance on your account — an administrative penalty or assessed tax. No dispute about it is in progress. SARS has sent you a final demand and it hasn't been paid. And SARS can identify someone who holds money for you.

The final demand must reach you at least 10 business days before the appointment, and it must set out what SARS may do next and the relief available to you.

Five business days to ask for relief

Once the final demand arrives, an individual has five business days to apply to SARS to reduce the amount collected, based on the basic living expenses of the taxpayer and their dependants. A business can apply on the grounds of serious financial hardship. After an appointment, anyone affected by it can still ask SARS to spread the payments out to cover basic living expenses. Open SARS letters as they arrive — the window is short.

What changed on 27 October 2026

SARS announced enhancements to its AA88 process for employers: a revised schedule for the appointments it issues automatically for personal income tax penalties and assessed tax debt. The aim is to give employers more time to load deductions before payroll closes, and fewer repeat appointments and cancellations. The updated employer guide sets the schedule out:

Assessed tax debt

Appointments generated every month, on the 28th, 29th and 30th

Penalties

Every second month — January, March, May, July, September and November — on the same dates

February

The 26th, 27th and 28th instead

Employers

Synchronise e@syFile and review from the 1st of the following month

November is a penalty month. New penalty appointments are generated from 28 November, and employers see them when they synchronise from 1 December.

If you're the employer

• Deduct and pay by the due date on the AA88. The amount on the notice may not be the employee's full balance
• Tell SARS if you can't comply — for example, the person no longer works for you. Record the outcome on e@syFile or through the SARS Contact Centre
• Stop only on SARS's word. Deductions stop when SARS issues a cancellation or withdrawal. Check it is genuine on e@syFile before you act on it
• Respond by the due date. After it, you have 20 business days to resolve the appointment before it moves to a defaulted status

An employer that pays the money to anyone else after receiving the notice becomes personally liable for the amount. SARS's guidance adds that ignoring an appointment can be a criminal offence.

Why it matters

Outstanding tax debt grows with penalties and interest. A penalty for an outstanding return runs from R250 to R16 000 a month, depending on your taxable income, and repeats every month the return is outstanding, for up to 35 months. Each month's penalty can arrive at your employer as a new AA88.

What you should do

• Check eFiling: Look for outstanding returns, assessments or penalties on your SARS profile
• Submit outstanding returns: It's the only thing that stops the monthly penalties. Then, if you had good reason for the delay, ask SARS to remit them
• Arrange to pay: SARS offers deferment and instalment arrangements. The arrangement must cover the whole debt, including interest, and SARS considers it only once all your returns are in
• Dispute what's wrong: Object within 80 business days of the assessment. An objection doesn't stop collection on its own, so ask SARS to suspend payment while it's decided
• Keep your details current: The final demand only helps you if it reaches you

How VSI Accountants can assist

We help individuals and businesses with tax return submissions, outstanding SARS balances, penalties and remission requests, and ongoing tax compliance. Bring us the letter you received, and we'll take it from there.

Sources: SARS, Changes to the AA88 process for employers, 27 October 2026 · Third-party appointments (AA88) · AA88 employer guide, revision 5 · Administrative penalties · Payment arrangements · Tax Administration Act, section 179 and section 164 · For informational purposes only