Category: Tax Administration Act No. 28 of 2011

Section 41 (TAA) – Authorisation for SARS official to conduct audit or criminal investigation

Posted on by admin_kmos

41.  Authorisation for SARS official to conduct audit or criminal investigation

 

(1)     A senior SARS official may grant a SARS official written authorisation to conduct a field audit or criminal investigation, as referred to in Part B.

 

(2)     When a SARS official exercises a power or duty under a tax Act in person, the official must produce the authorisation.

 

(3)     If the official does not produce the authorisation, a member of the public is entitled to assume that the official is not a SARS official so authorised.

Section 69 (TAA) – Secrecy of taxpayer information and general disclosure

Posted on by admin_kmos

69.    Secrecy of taxpayer information and general disclosure

 

(1)     A person who is a current or former SARS official must preserve the secrecy of taxpayer information and may not disclose taxpayer information to a person who is not a SARS official.

 

(2)     Subsection (1) does not prohibit the disclosure of taxpayer information by a person who is a current or former SARS official-

 

(a)     in the course of performance of duties under a tax Act or customs and excise legislation such as-

[Words preceding subparagraph (i) substituted by section 47 of Act 23 of 2015 effective on 8 January 2016]

 

(i)      to the South African Police Service or the National Prosecuting Authority, if the information relates to, and constitutes material information for the proving of, a tax offence;

 

(ii)     as a witness in civil or criminal proceedings under a tax Act; or

 

(iii)    the taxpayer information necessary to enable a person to provide such information as may be required by SARS from that person;

 

(b)     under any other Act which expressly provides for the disclosure of the information despite the provisions in this Chapter;

 

(c)     by order of a High Court; or

 

(d)     if the information is public information.

 

(3)     An application to the High Court for the order referred to in subsection (2)(c) requires prior notice to SARS of at least 15 business days unless the court, based on urgency, allows a shorter period.

 

(4)     SARS may oppose the application on the basis that the disclosure may seriously prejudice the taxpayer concerned or impair a civil or criminal tax investigation by SARS.

 

(5)     The court may not grant the order unless satisfied that the following circumstances apply:

 

(a)     the information cannot be obtained elsewhere;

 

(b)     the primary mechanisms for procuring evidence under an Act or rule of court will yield or yielded no or disappointing results;

 

(c)     the information is central to the case; and

 

(d)     the information does not constitute biometric information.

 

(6)     Subsection (1) does not prohibit the disclosure of information-

 

(a)     to the taxpayer; or

 

(b)     with the written consent of the taxpayer, to another person.

 

(7)     Biometric information of a taxpayer may not be disclosed by SARS except under the circumstances described in subsection (2)(a)(i).

 

(8)     The Commissioner may, despite the provisions of this section, disclose-

 

(a)     the name and taxpayer reference number of a taxpayer;

 

(b)     a list of-

 

(i)      pension funds, pension preservation funds, provident funds, provident preservation funds and retirement annuity funds as defined in section 1(1) of the Income Tax Act; and

 

(ii)     organisations approved under sections 18A and 30 of the Income Tax Act and the type of approval;

[Subparagraph (ii) substituted by section 26 of Act 18 of 2023]

[Pararagraph (b) substituted by section 53 of Act 16 of 2016] 

 

(c)     the name and tax practitioner registration number of a registered tax practitioner; and

 

(d)     taxpayer information in an anonymised form.

Section 42 (TAA) – Keeping taxpayer informed

Posted on by admin_kmos

42.  Keeping taxpayer informed

(1) A SARS official involved in or responsible for an audit under this Chapter must, in the form and in the manner as may be prescribed by the Commissioner by public notice, provide the taxpayer with a notice of commencement of an audit and, thereafter, a report indicating the stage of completion of the audit.

[Subsection (1) substituted by section 48(a) of Act 21 of 2012 and by section 16 of Act 22 of 2018.]

(2)     Upon conclusion of the audit or a criminal investigation, and where-

(a)     the audit or investigation was inconclusive, SARS must inform the taxpayer accordingly within 21 business days; or

(b)     the audit identified potential adjustments of a material nature, SARS must within 21 business days, or the further period that may be required based on the complexities of the audit, provide the taxpayer with a document containing the outcome of the audit, including the grounds for the proposed assessment or decision referred to in section 104(2).

(3)     Upon receipt of the document described in subsection (2)(b), the taxpayer must within 21 business days of delivery of the document, or the further period requested by the taxpayer that may be allowed by SARS based on the complexities of the audit, respond in writing to the facts and conclusions set out in the document.

(4)     The taxpayer may waive the right to receive the document.

(5)     Subsections (1) and (2)(b) do not apply if a senior SARS official has a reasonable belief that compliance with those subsections would impede or prejudice the purpose, progress or outcome of the audit.

(6)     SARS may under the circumstances described in subsection (5) issue the assessment or make the decision referred to in section 104(2) resulting from the audit and the grounds of the assessment or decision must be provided to the taxpayer within 21 business days of the assessment or the decision, or the further period that may be required based on the complexities of the audit or the decision.

Section 56 (TAA) – Confidentiality of proceedings

Posted on by admin_kmos

56.    Confidentiality of proceedings

 

(1)     An inquiry under this Part is private and confidential.

 

(2)     The presiding officer may, on request, exclude a person from the inquiry if the person’s attendance is prejudicial to the inquiry.

 

(3)     Section 69 applies with the necessary changes to persons present at the questioning of a person, including the person being questioned.

 

(4)     Subject to section 57(2), SARS may use evidence given by a person under oath or solemn declaration at an inquiry in a subsequent proceeding involving the person or another person.

Section 70 (TAA) – Disclosure to other entities

Posted on by admin_kmos

70.    Disclosure to other entities

(1)     A senior SARS official may provide to the Director-General of the National Treasury taxpayer information or SARS confidential information in respect of-

(a)     a taxpayer which is an-

(i)      institution referred to in section 3(1) of the Public Finance Management Act, 1999 (Act No. 1 of 1999); or

(ii)     entity referred to in section 3 of the Local Government: Municipal Finance Management Act, 2003 (Act No. 56 of 2003),

to the extent necessary for the Director-General to perform the functions and exercise the powers of the National Treasury under those Acts; and

(b)     a class of taxpayers to the extent necessary for the purposes of tax policy design or revenue estimation.

(2)     A senior SARS official may disclose to-

(a)     the Statistician-General the taxpayer information as may be required for the purpose of carrying out the Statistician-General’s duties to publish statistics in an anonymous form;

(b)     the Chairperson of the Board administering the National Student Financial Aid Scheme, the name and address of the employer of a person to whom a loan or bursary has been granted under that scheme, for use in performing the Chairperson’s functions under the National Student Financial Aid Scheme Act, 1999 (Act No. 56 of 1999);

(c)     a commission of inquiry established by the President of the Republic of South Africa under a law of the Republic, the information to which the Commission is authorised by law to have access;

(d)     to an employer (as defined in the Fourth Schedule to the Income Tax Act) of an employee (as defined in the Fourth Schedule), but only the income tax reference number, identity number, physical and postal address of that employee and such other non-financial information in relation to that employee, as that employer may require in order to comply with its obligations in terms of a tax Act; and

(e)     a recognised controlling body (as defined in section 239) of a registered tax practitioner, such information in relation to the tax practitioner as may be required to verify that sections 240A(2)(a) and 240A(3) are being given effect to.

(f)      the Department of Labour, the name and contact details of all employers registered for employees’ tax and eligible to receive the employment tax incentive in terms of section 2 of the Employment Tax Incentive Act, 2013.

(3)     A senior SARS official may disclose to-

(a)     the Governor of the South African Reserve Bank, or other person to whom the Minister delegates powers, functions and duties under the Regulations issued under section 9 of the Currency and Exchange Act, 1933 (Act 9 of 1933), the information as may be required to exercise a power or perform a function or duty under the South African Reserve Bank Act, 1989 (Act 90 of 1989), or those Regulations;

[Paragraph (a) substituted by section 25 of Act 24 of 2020]

(b) the Financial Sector Conduct Authority, the information as may be required for the purpose of carrying out the Financial Sector Conduct Authority’s duties and functions under the Financial Sector Regulation Act, 2017 (Act 9 of 2017);

[Paragraph (b) substituted by section 18(1) of Act 22 of 2018 effective on 1 April 2018.]

(c)     the Financial Intelligence Centre, the information as may be required for the purpose of carrying out the Centre’s duties and functions under the Financial Intelligence Centre Act, 2001 (Act 38 of 2001);

[Paragraph (c) amended by section 27(a) of Act 18 of 2023]

(d)     the National Credit Regulator, the information as may be required for the purpose of carrying out the Regulator’s duties and functions under the National Credit Act, 2005 (Act 34 of 2005); and

[Paragraph (d) amended by section 27(b) of Act 18 of 2023]

(e)     the Companies and Intellectual Property Commission, the information as may be required for the purpose of carrying out the Commission’s duties and functions under the Companies Act, 2008 (Act 71 of 2008);

[Paragraph (e) added by section 27(c) of Act 18 of 2023]


(f)      the Directorate for Nonprofit Organisations, the information as may be required for the purpose of carrying out the Directorate’s duties and functions under the Nonprofit Organisations Act, 1997 (Act 71 of 1997); and

[Paragraph (f) added by section 27(c) of Act 18 of 2023]


(g)     the Master as defined in section 1 of the Trust Property Control Act, 1988 (Act 57 of 1988), the information as may be required for the purpose of carrying out the Master’s duties and functions under that Act.

[Paragraph (g) added by section 27(c) of Act 18 of 2023]

(4)     A senior SARS official may disclose to an organ of state or institution listed in a regulation issued by the Minister under section 257, information to which the organ of state or institution is otherwise lawfully entitled to and for the purposes only of verifying the correctness of the following particulars of a taxpayer:

(a)     name and taxpayer reference number;

(b)     any identifying number;

(c)     physical and postal address and other contact details;

(d)     employer’s name, address and contact details; and

(e)     other non-financial information as the organ of state or institution may require for purposes of verifying paragraphs (a) to (d).

(5)     The information disclosed under subsection (1), (2) or (3) may only be disclosed by SARS or the persons or entities referred to in subsection (1), (2) or (3) to the extent that it is-

(a)     necessary for the purpose of exercising a power or performing a regulatory function or duty under the legislation referred to in subsection (1), (2) or (3); and

(b)     relevant and proportionate to what the disclosure is intended to achieve as determined under the legislation.

[Subsection (5) substituted by section 48 of Act 23 of 2015 effective on 8 January 2016]

(6)     SARS must allow the Auditor-General to have access to information in the possession of SARS that relates to the performance of the Auditor-General’s duties under section 4 of the Public Audit Act, 2004 (Act No. 25 of 2004).

(7)     Despite subsections (1) to (5), a senior SARS official may not disclose information under this section if satisfied that the disclosure would seriously impair a civil or criminal tax investigation.