‘debtor’ means a taxpayer with a tax debt; and
Category: Tax Administration Act No. 28 of 2011
Part B – Payment of tax (TAA)
Part B
Payment of tax
Section 172 (TAA) – Application for civil judgment for recovery of tax
172. Application for civil judgment for recovery of tax
(1) If a person has an outstanding tax debt, SARS may, after giving the person at least 10 business days’ notice, file with the clerk or registrar of a competent court a certified statement setting out the amount of tax payable and certified by SARS as correct.
(2) SARS may file the statement irrespective of whether or not the tax debt is subject to an objection or appeal under Chapter 9, unless the period referred to in section 164(6) has not expired or the obligation to pay the tax debt has been suspended under section 164.
(3) SARS is not required to give the taxpayer prior notice under subsection (1) if SARS is satisfied that giving notice would prejudice the collection of the tax.
Section 185 (TAA) – Tax recovery on behalf of foreign governments
185. Tax recovery on behalf of foreign governments
(1) If SARS has, in accordance with an international tax agreement, received-
(a) a request for conservancy of an amount alleged to be due by a person under the tax laws of the other country where there is a risk of dissipation or concealment of assets by the person, a senior SARS official may authorise an application for a preservation order under section 163 as if the amount were a tax payable by the person under a tax Act; or
[Paragraph (a) substituted by section 58 of Act 23 of 2015 effective on 1 October 2012]
(b) a request for the collection from a person of an amount alleged to be due by the person under the tax laws of the other country, a senior SARS official may, by notice, call upon the person to state, within a period specified in the notice, whether or not the person admits liability for the amount or for a lesser amount.
(2) A request described in subsection (1) must be in the prescribed form and must include a formal certificate issued by the competent authority of the other country stating-
(a) the amount of the tax due;
(b) whether the liability for the amount is disputed in terms of the laws of the other country;
(c) if the liability for the amount is so disputed, whether such dispute has been entered into solely to delay or frustrate collection of the amount alleged to be due; and
(d) whether there is a risk of dissipation or concealment of assets by the person.
(3) In any proceedings, a certificate referred to in subsection (2) is-
(a) conclusive proof of the existence of the liability alleged; and
(b) prima facie proof of the other statements contained therein.
(4) If, in response to the notice issued under subsection (1)(b), the person-
(a) admits liability;
(b) fails to respond to the notice; or
(c) denies liability but a senior SARS official, based on the statements in the certificate described in subsection (2) or, if necessary, after consultation with the competent authority of the other country, is satisfied that-
(i) the liability for the amount is not disputed in terms of the laws of the other country;
(ii) although the liability for the amount is disputed in terms of the laws of the other country, such dispute has been entered into solely to delay or frustrate collection of the amount alleged to be due; or
(iii) there is a risk of dissipation or concealment of assets by the person,
the official may, by notice, require the person to pay the amount for which the person has admitted liability or the amount specified, on a date specified, for transmission to the competent authority in the other country.
(5) If the person fails to comply with the notice under subsection (4), SARS may recover the amount in the certificate for transmission to the foreign authority as if it were a tax payable by the person under a tax Act.
(6) No steps taken in assistance in collection by any other country under an international tax agreement for the collection of an amount alleged to be due by a person under a tax Act, including a judgment given against a person in the other country for the amount in pursuance of the agreement, may affect the person’s right to have the liability for the amount determined in the Republic in accordance with the relevant law.
“Write off” definition of section 192 of TAA
‘write off’ means to reverse an outstanding tax debt either in whole or in part.
Section 162 (TAA) – Determination of time and manner of payment of tax
162. Determination of time and manner of payment of tax
(1) Tax must be paid by the day and at the place notified by SARS, the Commissioner by public notice or as specified in a tax Act, and must be paid as a single amount or in terms of an instalment payment agreement under section 167.
(2) The Commissioner may by public notice prescribe the method of payment of tax, including electronically.
(3) Despite sections 96(1)(f) and 167, a senior SARS official may, if there are reasonable grounds to believe that-
(a) a taxpayer will not pay the full amount of tax;
(b) a taxpayer will dissipate the taxpayer’s assets; or
(c) that recovery may become difficult in the future,
require the taxpayer to-
(i) pay the full amount immediately upon receipt of the notice of assessment or a notice described in section 167(6) or within the period as the official deems appropriate under the circumstances; or
(ii) provide such security as the official deems necessary.
Section 173 (TAA) – Jurisdiction of Magistrates’ Court in judgment procedure
173. Jurisdiction of Magistrates’ Court in judgment procedure
Despite anything to the contrary in the Magistrates’ Courts Act, 1944 (Act No. 32 of 1944), the certified statement referred to in section 172 may be filed with the clerk of the Magistrate’s Court that has jurisdiction over the taxpayer named in the statement.
Part F – Remedies with respect to foreign assets (TAA)
Part F
Remedies with respect to foreign assets
Section 193 (TAA) – Purpose of Chapter
193. Purpose of Chapter
(1) As a general rule, it is the duty of SARS to assess and collect all tax debts according to a tax Act and not to forgo any tax debts.
(2) SARS may, when required by circumstances, deviate from the strictness and rigidity of the general rule referred to in subsection (1) if it would be to the best advantage of the State.
(3) The purpose of this Chapter is to prescribe the circumstances under which SARS may deviate from the general rule and take a decision to ‘write off’ a tax debt or not to pursue its collection.
Section 163 (TAA) – Preservation order
163. Preservation order
(1) A senior SARS official may, in order to prevent any realisable assets from being disposed of or removed which may frustrate the collection of the full amount of tax that is due or payable or the official on reasonable grounds is satisfied may be due or payable, authorise an ex parte application to the High Court for an order for the preservation of any assets of a taxpayer or other person prohibiting any person, subject to the conditions and exceptions as may be specified in the preservation order, from dealing in any manner with the assets to which the order relates.
(2)
(a) SARS may, in anticipation of the application under subsection (1) seize the assets pending the outcome of an application for a preservation order, which application must commence within 24 hours from the time of seizure of the assets or the further period that SARS and the taxpayer or other person may agree on.
(b) Until a preservation order is made in respect of the seized assets, SARS must take reasonable steps to preserve and safeguard the assets including appointing a curator bonis in whom the assets vest.
(3) A preservation order may be made if required to secure the collection of the tax referred to in subsection (1) and in respect of-
(a) realisable assets seized by SARS under subsection (2);
(b) the realisable assets as may be specified in the order and which are held by the person against whom the preservation order is being made;
(c) all realisable assets held by the person, whether it is specified in the order or not; or
(d) all assets which, if transferred to the person after the making of the preservation order, would be realisable assets.
(4) The court to which an application for a preservation order is made may-
(a) make a provisional preservation order having immediate effect;
(b) simultaneously grant a rule nisi calling upon the taxpayer or other person upon a business day mentioned in the rule to appear and to show cause why the preservation order should not be made final;
(c) upon application by the taxpayer or other person, anticipate the return day for the purpose of discharging the provisional preservation order if 24 hours’ notice of the application has been given to SARS; and
(d) upon application by SARS, confirm the appointment of the curator bonis under subsection (2)(a) or appoint a curator bonis in whom the seized assets vest.
(5) A preservation order must provide for notice to be given to the taxpayer and a person from whom the assets are seized.
(6) For purposes of the notice or rule required under subsection (4)(b) or (5), if the taxpayer or other person has been absent for a period of 21 business days from his or her usual place of residence or business within the Republic, the court may direct that it will be sufficient service of that notice or rule if a copy thereof is affixed to or near the outer door of the building where the court sits and published in the Gazette, unless the court directs some other mode of service.
(7) The court, in granting a preservation order, may make any ancillary orders regarding how the assets must be dealt with, including-
(a) authorising the seizure of all movable assets;
(b) if not appointed under subsection (4)(d), appointing a curator bonis in whom the assets vest;
(c) realising the assets in satisfaction of the tax debt;
(d) making provision as the court may think fit for the reasonable living expenses of a person against whom the preservation order is being made and his or her legal dependants, if the court is satisfied that the person has disclosed under oath all direct or indirect interests in assets subject to the order and that the person cannot meet the expenses concerned out of his or her unrestrained assets; or
(e) any other order that the court considers appropriate for the proper, fair and effective execution of the order.
(8) The court making a preservation order may also make such further order in respect of the discovery of any facts including facts relating to any asset over which the taxpayer or other person may have effective control and the location of the assets as the court may consider necessary or expedient with a view to achieving the objects of the preservation order.
(9) The court which made a preservation order may on application by a person affected by that order vary or rescind the order or an order authorising the seizure of the assets concerned or other ancillary order if it is satisfied that-
(a) the operation of the order concerned will cause the applicant undue hardship; and
(b) the hardship that the applicant will suffer as a result of the order outweighs the risk that the assets concerned may be destroyed, lost, damaged, concealed or transferred.
(10) A preservation order remains in force-
(a) pending the setting aside thereof on appeal, if any, against the preservation order; or
(b) until the assets subject to the preservation order are no longer required for purposes of the satisfaction of the tax debt.
(11) In order to prevent any realisable as sets that were not seized under subsection(2) from being disposed of or removed contrary to a preservation order under this section, a senior SARS official may seize the assets if the official has reasonable grounds to believe that the assets will be so disposed of or removed.
(12) Assets seized under this section must be dealt with in accordance with the directions of the High Court which made the relevant preservation order.