As we step into 2026, there is no better time for taxpayers to gain clarity on their exact standing with the South African Revenue Service (Sars). Many individuals assume their tax affairs are in perfect order, but as the saying goes, assumption is the mother of all mistakes. When it comes to Sars, it can be an expensive one.

Even taxpayers with the best intentions, may be unaware that the system could reflect matters such as missed filings, outstanding penalties, or discrepancies between submitted returns and Sars records. The only way to know for sure is through a Tax Health Check, and the most efficient way to do this is via a Tax Diagnostic Review. 

Our Tax Diagnostic is a proprietary tool developed to provide a thorough review of your Sars profile, identify potential risks, reconcile records, and highlight areas requiring attention. It gives you a clear picture of where you stand before any issues escalate. 

Much like medical test results that pinpoint areas needing attention, a Tax Diagnostic removes uncertainty and flags compliance areas the taxpayer may not even know exists.

Sars Self-Evaluation and Early-Year Planning

A Tax Diagnostic also serves as a form of Sars self-evaluation. Reviewing your tax standing early in the year allows you to understand how Sars interprets your filings, what risks exist on your profile, and whether historical submissions match Sars’s internal records. 

The Tax Diagnostic Process and Its Benefits

A Tax Diagnostic is not only about identifying problems — it is about creating a clear plan of action for the year. The process typically involves the following components:

1. Reconciling your records with Sars: Ensuring all returns, payments, and filings match exactly.

2. Verifying personal and contact information: Making sure Sars can reach you and that no notices or important correspondence are missed.

3.      Identifying errors and potential risks:

·Administrative issues: incorrect personal details, missing documents, or misclassified expenses

·Compliance risks: undeclared foreign income, discrepancies in previous filings, overlooked deductions, or late submissions

4. Developing a strategic action plan: Outlining next steps, deadlines, and interventions required. These actions should ideally be developed in consultation with, or left to, qualified tax specialists to ensure compliance and effectiveness.

5. Engaging with Sars when necessary: Correcting errors, updating records, or requesting reprocessing before problems escalate.

The benefits of this process are immediate:

• Proactive compliance: Potential issues are addressed before Sars escalates.
• Avoiding surprises: Hidden inconsistencies, notices, or penalties are uncovered and resolved early.
• Better planning: With an accurate view of your profile, you can plan tax submissions, investments, or business decisions with confidence.
• Informed decision-making: You act on accurate information, not assumptions. Therefore, you are being proactive, not exposing yourself to Sars.
• Peace of mind: You know exactly where you stand and that your affairs are in order.

Recommended Steps for Specific Situations

A Tax Diagnostic is valuable for all taxpayers, but even more so for expatriates and those planning to emigrate. It also comes with recommended steps tailored to your situation, which is particularly important for:

• Individuals who have left South Africa: Ensuring tax compliance before departure and addressing any outstanding matters.
• Individuals planning to leave South Africa: Planning proactively to mitigate risks and prevent penalties while abroad.
• Individuals intending to cease South African tax residency or wind down their tax affairs: Mapping out the proper steps for ceasing your tax obligations in South Africa, ensuring that your exit or cessation is handled correctly and aligns with Sars requirements.

By following these recommended steps, you can reduce unexpected exposure, prevent issues from escalating, and create a clear path forward — all without relying solely on Sars notifications. This ensures you are fully prepared whether you are living in South Africa or abroad.

Ultimately, a Tax Diagnostic provides the opportunity to start the tax year on solid footing, rather than reacting to problems later.

Conclusion: Start the Year with Confidence

Conducting a Tax Diagnostic immediately after the holidays is a strategic and proactive step, ensuring clarity, compliance, and peace of mind – rather than waiting for Sars to highlight issues.

Whether you are staying in South Africa, planning to leave, have already moved, or are planning to cease your South African tax affairs, a Tax Diagnostic helps guide the process and ensures you approach the year with confidence and certainty. 

Written by Rendani Makatu, Expatriate Tax Support Specialist at Tax Consulting SA; and Alex Mahundla, Sars Compliance Specialist at Tax Consulting SA