A VAT return that has already been submitted can be corrected — ordinarily by requesting a correction of that return on eFiling, or where the error is material or historic, through the Voluntary Disclosure Programme. Interest generally runs on tax that was underpaid regardless of how the correction is made. What changes dramatically is the understatement penalty position, and it changes the moment SARS opens an audit or investigation.
The single most important thing about fixing a VAT error is doing it before somebody else notices.
What kind of mistake is it?
The remedy depends on the answer, so establish this first.
| Type of error | Typical route |
|---|---|
| Wrong figure on a recent return | Request a correction of that return |
| Input VAT you forgot to claim | Claim it, subject to the time limit for input claims |
| A supply treated as zero-rated that was standard-rated | Correction — and check whether other periods are affected |
| Systematic error across several periods | Take advice. This is where the VDP question arises |
| Deliberate understatement | Take advice immediately. Different territory entirely |
The distinction that matters is between a slip and a pattern. A single wrong figure in one period is administrative. The same error repeated across eight periods is a different conversation, and treating it as the first when it is the second is how people make things worse.
Correcting a recent return
The ordinary route is a request for correction of the submitted return on eFiling, resubmitting it with the correct figures.
Before you do:
Establish what the correct figure actually is, with the supporting documents behind it. Resubmitting a return with a second wrong number is worse than the first one.
Check whether other periods are affected. Errors are rarely isolated — a supply misclassified in March was probably misclassified in January too.
Work out the direction. Underpaid VAT means tax plus interest. Overpaid VAT means a refund, which will very likely be verified.
Keep the reason. Write down what went wrong and why, at the time. In eighteen months nobody will remember, and a verification will ask.
What it costs
Three separate things, and people confuse them.
The tax itself. Whatever was underpaid is payable. This is not a penalty — it is the tax that was always owed.
Interest. Charged on late or underpaid tax, running from when the payment was due. Interest is not generally waived because you corrected voluntarily, and it accumulates while you decide what to do — which is an argument for acting quickly.
Understatement penalties. This is the variable, and it can be very large. The percentage applied depends on the behaviour — a bona fide inadvertent error sits at one end, and gross negligence or intentional evasion at the other. Whether the disclosure was voluntary, and whether it came before or after SARS acted, moves the figure materially.
That last point is the whole reason to move now rather than later. See how SARS penalties and interest are calculated.
When is the VDP the right route?
The Voluntary Disclosure Programme exists for exactly this situation, and it is the right route where the exposure is material or historic.
Applied for correctly and — critically — before SARS has notified you of an audit, inquiry or investigation into that matter, the VDP offers relief from understatement penalties where the requirements are met. Interest remains payable.
The timing rule is absolute. Once SARS has opened an audit for the period, the VDP is off the table for that matter. There is no negotiating this, and no warning that the window is about to close.
When to consider it:
The error spans multiple periods
The amount is material
There is any question about whether the treatment was deliberate
You have discovered something you would not want SARS to find first
Take advice before applying. A VDP application is a formal disclosure with consequences, and the requirements have to be met for the relief to apply. This is not a form to fill in casually.
The specific errors that recur
Input VAT claimed without a valid tax invoice. The most common finding in a VAT audit. The expense was real; the document did not meet the requirements. See what makes a valid tax invoice.
Input VAT claimed on denied supplies — entertainment, motor cars, club subscriptions. Denied outright regardless of business purpose. See the expenses you can never claim VAT on.
Zero-rating without documentation. An export zero-rated without proof of export is assessed at 15%.
Exempt supplies treated as taxable, or the reverse. Affects both output VAT and every input claim on related costs. See zero-rated, exempt and standard-rated.
No apportionment where the business makes both taxable and exempt supplies. A straightforward over-claim.
Output VAT omitted on a disposal of business assets. Selling a vehicle or equipment is generally a taxable supply.
Timing errors on the invoice basis — VAT declared when paid rather than when invoiced. See VAT invoice basis vs payments basis.
Missed bad debt relief. This one is in your favour, and almost nobody claims it.
What if the mistake was in my favour?
Correct it anyway, and expect a verification.
A correction producing a refund is exactly the kind of return SARS examines. Have the supporting documentation assembled before you submit rather than after they ask.
And note the time limit on input claims. Input VAT not claimed in the correct period can generally be claimed later, but there is a limit and it is not indefinite. Confirm the current position before assuming an old claim is still available.
See why is SARS holding your VAT refund.
How to stop it recurring
Reconcile VAT monthly, even on a bi-monthly cycle. Errors found within the period are corrected before submission, which is the whole game.
Reconcile output VAT to your sales ledger and input VAT to your purchases ledger, every period. A difference you cannot explain is an error you have not found yet.
Check the input VAT documentation as you capture it, not at year end. A supplier will reissue a defective invoice in the month; they will be much harder to reach two years later.
Keep a note of every judgement call — why a supply was zero-rated, how apportionment was calculated. The reasoning is what a verification actually tests.
Review the classification of your supplies annually, particularly if the business has changed what it sells.
Frequently asked questions
Can I correct a VAT return I have already submitted? Yes. The ordinary route is a request for correction of that return on eFiling. Where the error is material or spans several periods, the Voluntary Disclosure Programme may be the appropriate route.
Will I be penalised for correcting a VAT return? Interest generally runs on tax that was underpaid regardless. Understatement penalties depend on the behaviour involved and on whether the disclosure was voluntary and made before SARS acted.
What is the Voluntary Disclosure Programme? A SARS mechanism allowing a taxpayer to disclose a default and obtain relief from understatement penalties where the requirements are met. Interest remains payable, and it is only available before SARS has notified you of an audit or investigation into that matter.
What happens if SARS finds the error first? The VDP is no longer available for that matter, and the understatement penalty position is materially worse. This is the reason to correct errors promptly rather than waiting.
Can I claim input VAT I forgot in an earlier period? Generally yes, but there is a time limit on input claims and it is not indefinite. Confirm the current position before assuming an old claim is still available.
What is the most common VAT error? Input VAT claimed without a valid tax invoice. The expense was genuine, but the document did not meet the requirements — and it is the most frequent finding in a VAT audit.
Should I correct an error that was in my favour? Yes. Expect the correction to be verified, and assemble the supporting documentation before submitting rather than after SARS asks.
How do I stop this happening again? Reconcile VAT monthly, tie output VAT to the sales ledger and input VAT to the purchases ledger every period, check input documentation as you capture it, and record the reasoning behind every judgement call.
Correcting it early is the whole strategy
Nothing about a VAT error improves with time. Interest accumulates, the number of affected periods grows, and the option that would have limited the penalty disappears the day SARS opens an audit — without any warning that it is about to.
Smartbook reconciles VAT monthly so errors surface within the period, checks input documentation as it is captured, and where something historic is found, assesses whether a correction or a VDP application is the right route before anything is submitted.
See monthly accounting plans →
Last reviewed: 28 August 2026. Written by the Smartbook team — SAIPA and SAICA accredited, SARS registered tax practitioners. Understatement penalty percentages, interest rates and the requirements of the Voluntary Disclosure Programme are set out in the Tax Administration Act and change from time to time. Take advice before making a VDP application or correcting a material or historic error. General guidance, not advice on your circumstances.
Primary sources: SARS — Value-Added Tax · SARS — Voluntary Disclosure Programme · Tax Administration Act 28 of 2011 · Value-Added Tax Act 89 of 1991