Category: Tax Administration Act No. 28 of 2011

Section 26 (TAA) – Third party returns

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26.    Third party returns

(1)     The Commissioner may by public notice, at the time and place and by the due date specified, require a person who employs, pays amounts to, receives amounts on behalf of or otherwise transacts with another person, or has control over assets of another person, to submit a return by the date specified in the notice.

(2)     A person required under subsection (1) to submit a return must do so in the prescribed form and manner and the return must-

(a)     contain the information prescribed by the Commissioner;

(b)     be a full and true return; and

(c)     for purposes of providing the information required in the return, comply with the due diligence requirements as may be prescribed in a tax Act, an international tax agreement, an international tax standard or by the Commissioner in a public notice consistent with the international tax agreement or the international tax standard.

[Paragraph (c) substituted by section 38 of Act 23 of 2015 effective on 8 January 2016]

(3)     The Commissioner may, by public notice, require a person to apply to register as a person required to submit a return under this section, an international tax agreement or an international tax standard.

[Subsection (3) added by section 38 of Act 23 of 2015 effective on 8 January 2016]

(4)     If, in order to submit a return under subsection (1) and to comply with the requirements of this section, a person requires information, a document or thing from another person, the other person must provide the information, document or thing so required within a reasonable time.

[Subsection (4) added by section 38 of Act 23 of 2015 effective on 8 January 2016]

Section 46 (TAA) – Request for relevant material

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46.    Requeset for relevant material

(1)     SARS may, for the purposes of the administration of a tax Act in relation to a taxpayer, whether identified by name or otherwise objectively identifiable, require the taxpayer or another person to, within a reasonable period, submit relevant material (whether orally or in writing) that SARS requires.

(2)     A senior SARS official may require relevant material in terms of subsection (1) –

(a)     in respect of taxpayers in an objectively identifiable class of taxpayers; or

(b)     held or kept by a connected person, as referred to in paragraph (d)(i) of the definition of “connected person” in the Income Tax Act, in relation to the taxpayer, located outside the Republic.

[Subsection (2) substituted by section 42 of Act 23 of 2015 effective on 8 January 2016]

(3)   A request by SARS for relevant material from a person other than the taxpayer is limited to material maintained or kept or that should reasonably be maintained or kept by the person in relation to the taxpayer.

[Subsection (3) substituted by section 50(a) of Act 21 of 2012, by section 42(a) of Act 23 of 2015 and by section 30 of Act 33 of 2019]

(4)     A person or taxpayer receiving from SARS a request for relevant material under this section must submit the relevant material to SARS at the place, in the format (which must be reasonably accessible to the person or taxpayer) and-

(a)     within the time specified in the request; or

(b)     if the material is held by a connected person referred to in subsection (2)(b), within 90 days from the date of the request, which request must set out the consequences referred to in subsection (9) of failing to do so.

[Subsection (4) substituted by section 46 of Act 44 of 2014 effective on 1 October 2012 and section 42 of Act 23 of 2015 effective on 8 January 2016] 

(5)     If reasonable grounds for an extension are submitted by the person or taxpayer, SARS may extend the period within which the relevant material must be submitted.

[Subsection (5) substituted by section 50 of Act 21 of 2012 effective on 1 October 2012 and section 42 of Act 23 of 2015 effective on 8 January 2016]

(6)     Relevant material required by SARS under this section must be referred to in the request with reasonable specificity.

(7)     A senior SARS official may direct that relevant material-

(a)     be provided under oath or solemn declaration; or

(b)     if required for purposes of a criminal investigation, be provided under oath or solemn declaration and, if necessary, in accordance with the requirements of section 212 or 236 of the Criminal Procedure Act, 1977 (Act No. 51 of 1977).

(8)     A senior SARS official may request relevant material that a person has available for purposes of revenue estimation.


(9)     If a taxpayer fails to provide material referred to in subsection (2)(b), the material may not be produced by the taxpayer in any subsequent proceedings, unless a competent court directs otherwise on the basis of circumstances outside the control of the taxpayer and any connected person referred to in paragraph (d)(i) of the definition of “connected person” in the Income Tax Act, in relation to the taxpayer.

[Subsection (9) added by section 42 of Act 23 of 2015 effective on 8 January 2016]

Section 60 (TAA) – Issuance of warrant

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60.    Issuance of warrant

 

(1)     A judge or magistrate may issue the warrant referred to in section 59(1) if satisfied that there are reasonable grounds to believe that-

 

(a)     a person failed to comply with an obligation imposed under a tax Act, or committed a tax offence; and

 

(b)     relevant material likely to be found on the premises specified in the application may provide evidence of the failure to comply or commission of the offence.

 

(2)     A warrant issued under subsection (1) must contain the following:

 

(a)     the alleged failure to comply or offence that is the basis for the application;

 

(b)     the person alleged to have failed to comply or to have committed the offence;

 

(c)     the premises to be searched; and

 

(d)     the fact that relevant material as defined in section 1 is likely to be found on the premises.

 

(3)     The warrant must be exercised within 45 business days or such further period as a judge or magistrate deems appropriate on good cause shown.

Section 27 (TAA) – Other returns required

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27.    Other returns required

 

(1)     A senior SARS official may require a person to submit further or more detailed returns regarding any matter for which a return under section 25 or 26 is required or prescribed by a tax Act.

 

(2)     A person required under subsection (1) to submit a return must do so in the prescribed form and manner and the return must contain the information prescribed by the official and must be a full and true return.

Section 47 (TAA) – Production of relevant material in person

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47.    Production of relevant material in person

(1)     A senior SARS official may, by notice, require a person, whether or not chargeable to tax, an employee of the person or a person who holds an office in the person to attend in person at the time and place designated in the notice for the purpose of being interviewed by a SARS official concerning the tax affairs of the person, if the interview-

(a)     is intended to clarify issues of concern to SARS-

(i)      to render further verification or audit unnecessary; or

(ii)     to expedite a current verification or audit; and

(b)     is not for purposes of a criminal investigation.

[Subsection (1) substituted by section 43 of Act 23 of 2015 effective on 8 January 2016]

(2)     The senior SARS official issuing the notice may require the person interviewed to produce relevant material under the control of the person during the interview.

(3)     Relevant material required by SARS under subsection (2) must be referred to in the notice with reasonable specificity.

(4)     A person may decline to attend an interview, if the distance between the place designated in the notice and the usual place of business or residence of the person exceeds the distance prescribed by the Commissioner by public notice.

Section 61 (TAA) – Carrying out search

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61.    Carrying out search

 

(1)     A SARS official exercising a power under a warrant referred to in section 60 must produce the warrant, and if the owner or person in control of the premises is not present, the SARS official must affix a copy of the warrant to the premises in a prominent and visible place.

 

(2)     Subject to section 63, a SARS official’s failure to produce a warrant entitles a person to refuse access to the official.

 

(3)     The SARS official may-

 

(a)     open or cause to be opened or removed in conducting a search, anything which the official suspects to contain relevant material;

 

(b)     seize any relevant material;

 

(c)     seize and retain a computer or storage device in which relevant material is stored for as long as it is necessary to copy the material required;

 

(d)     make extracts from or copies of relevant material, and require from a person an explanation of relevant material; and

 

(e)     if the premises listed in the warrant is a vessel, aircraft or vehicle, stop and board the vessel, aircraft or vehicle, search the vessel, aircraft or vehicle or a person found in the vessel, aircraft or vehicle, and question the person with respect to a matter dealt with in a tax Act.

 

(4)     The SARS official must make an inventory of the relevant material seized in the form, manner and at the time that is reasonable under the circumstances and provide a copy thereof to the person.

 

(5)     The SARS official must conduct the search with strict regard for decency and order, and may search a person if the official is of the same gender as the person being searched.

 

(6)     The SARS official may, at any time, request such assistance from a police officer as the official may consider reasonably necessary and the police officer must render the assistance.

 

(7)     No person may obstruct a SARS official or a police officer from executing the warrant or without reasonable excuse refuse to give such assistance as may be reasonably required for the execution of the warrant.

 

(8)     If the SARS official seizes relevant material, the official must ensure that the relevant material seized is preserved and retained until it is no longer required for-

 

(a)     the investigation into the non-compliance or the offence described under section 60(1)(a);or

 

(b)     the conclusion of any legal proceedings under a tax Act or criminal proceedings in which it is required to be used.

Section 28 (TAA) – Statement concerning accounts

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28.  Statement concerning accounts

 

(1)     SARS may require a person who submits financial statements or accounts prepared by another person in support of that person’s submitted return, to submit a certificate or statement by the other person setting out the details of-

 

(a)     the extent of the other person’s examination of the books of account and of the documents from which the books of account were written up; and

 

(b)     whether or not the entries in those books and documents disclose the true nature of the transactions, receipts, accruals, payments or debits in so far as may be ascertained by that examination.

 

(2)     A person who prepares financial statements or accounts for another person must, at the request of that other person, submit to that other person a copy of the certificate or statement referred to in subsection (1).

Section 35 (TAA) – Reportable arrangements

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35.  Reportable arrangements

 

(1)     An “arrangement” is a reportable arrangement if a person is a “participant” in the “arrangement” and the “arrangement”–

 

(a)     contains provisions in terms of which the calculation of interest as defined in section 24J of the Income Tax Act, finance costs, fees or any other charges is wholly or partly dependent on the assumptions relating to the tax treatment of that ‘arrangement’ (otherwise than by reason of any change in the provisions of a tax Act);

 

(b)     has any of the characteristics contemplated in section 80C(2)(b) of the Income Tax Act, or substantially similar characteristics;

 

(c)     gives rise to an amount that is or will be disclosed by any ‘participant’ in any year of assessment or over the term of the ‘arrangement’ as-

 

(i)      a deduction for purposes of the Income Tax Act but not as an expense for purposes of ‘financial reporting standards’; or

 

(ii)     revenue for purposes of ‘financial reporting standards’ but not as gross income for purposes of the Income Tax Act;

 

(d)     does not result in a reasonable expectation of a ‘pre-tax profit’ for any ‘participant’; or

 

(e)     results in a reasonable expectation of a ‘pre-tax profit’ for any ‘participant’ that is less than the value of that ‘tax benefit’ to that ‘participant’ if both are discounted to a present value at the end of the first year of assessment when that ‘tax benefit’ is or will be derived or is assumed to be derived, using consistent assumptions and a reasonable discount rate for that ‘participant’.

 

(2)     An “arrangement” is a “reportable arrangement” if the Commissioner has listed the “arrangement” in a public notice.