Category: Tax Administration Act No. 28 of 2011

Section 205 (TAA) – SARS not bound by compromise of tax debt

Posted on by admin_kmos

205.    SARS not bound by compromise of tax debt

 

SARS is not bound by a ‘compromise’ if-

 

(a)     the ‘debtor’ fails to disclose a material fact to which the ‘compromise’ relates;

 

(b)     the ‘debtor’ supplies materially incorrect information to which the ‘compromise’ relates;

 

(c)     the ‘debtor’ fails to comply with a provision or condition contained in the agreement referred to in section 204; or

 

(d)     the ‘debtor’ is liquidated or the ‘debtor’s’ estate is sequestrated before the ‘debtor’ has fully complied with the conditions contained in the agreement referred to in section 204.

Section 212 (TAA) – Reportable arrangement penalty

Posted on by admin_kmos

212. Reportable arrangement and mandatory disclosure penalty

(1)     A person referred to in-

(a)     paragraph (a) or (b) of the definition of ‘participant’ in section 34, who fails to disclose the information in respect of a ‘reportable arrangement’, as required by section 37; or

(b)     the definition of intermediary in the regulations, issued in respect of paragraph (a) of the definition of ‘international tax standard’, who fails to disclose the information required to be disclosed under the regulations,

is liable to a ‘penalty’, for each month that the failure continues (up to 12 months), in the amount of-

(i)      R50 000, in the case of a ‘participant’ or intermediary, as the case may be, other than the ‘promoter’; or

(ii)      R100 000, in the case of the ‘promoter’.

(2)     The amount of ‘penalty’ determined under subsection (1) is doubled if the amount of anticipated ‘tax benefit’, as defined in section 34, for the ‘participant’ by reason of the arrangement (within the meaning of section 35) exceeds R5 000 000, and is tripled if the benefit exceeds R10 000 000.

(3)     A person referred to in paragraph (c) of the definition of ‘participant’ in section 34, who fails to disclose the information in respect of a ‘reportable arrangement’ as required by section 37 is liable to a ‘penalty’ in the amount of R50 000.

[Section 212 amended by section 62(a) and (b) of Act 23 of 2015 and substituted by section 41 of Act 33 of 2019]

Section 231 (TAA) – Withdrawal of voluntary disclosure relief

Posted on by admin_kmos

231.    Withdrawal of voluntary disclosure relief

 

(1)     In the event that, subsequent to the conclusion of a voluntary disclosure agreement under section 230, it is established that the applicant failed to disclose a matter that was material for purposes of making a valid voluntary disclosure under section 227, a senior SARS official may-

 

(a)     withdraw any relief granted under section 229;

 

(b)     regard an amount paid in terms of the voluntary disclosure agreement to constitute part payment of any further outstanding tax debt in respect of the relevant ‘default’; and

 

(c)     pursue criminal prosecution for a tax offence.

 

(2)     Any decision by the senior SARS official under subsection (1) is subject to objection and appeal.

“Tax” definition of section 221 of TAA

Posted on by admin_kmos

‘tax’ means a tax as defined in section 1, excluding a penalty and interest, and will for purposes of this Part include an employment tax incentive as referred to in section 2(1) of the Employment Tax Incentive Act, 2013 (Act 26 of 2013);

[Definition of ‘tax’ substituted by section 26(1) of Act 16 of 2022 deemed effective on 1 September 2022, and applicable to any return, for purposes of paragraph 14(2) of the Fourth Schedule to the Income Tax Act, submitted or after that date]

Section 206 (TAA) – Register of tax debts written off or compromised (TAA)

Posted on by admin_kmos

206.    Register of tax debts written off or compromised

 

(1)     SARS must maintain a register of the tax debts ‘written off or ‘compromised’ in terms of this Chapter.

 

(2)     The register referred to in subsection (1) must contain-

 

(a)     the details of the ‘debtor’, including name, address and taxpayer reference number;

 

(b)     the amount of the tax debt ‘written off’ or ‘compromised’ and the periods to which the tax debt relates; and

 

(c)     the reason for ‘writing off’ or ‘compromising’ the tax debt.

Section 213 (TAA) – Imposition of percentage based penalty

Posted on by admin_kmos

213.    Imposition of percentage based penalty

(1)     If SARS is satisfied that an amount of tax was not paid as and when required under a tax Act, SARS must, in addition to any other “penalty” or interest for which a person may be liable, impose a “penalty” equal to the percentage of the amount of unpaid tax as prescribed in the tax Act.

[Subsection (1) substituted by section 63 of Act 23 of 2015 effective on 1 October 2012]

(2)     In the event of a change to the amount of tax in respect of which a ‘penalty’ was imposed under subsection (1), the ‘penalty’ must be adjusted accordingly with effect from the date of the imposition of the ‘penalty’.

“Tax position” definition of section 221 of TAA

Posted on by admin_kmos

‘tax position’ means an assumption underlying one or more aspects of a tax return, including whether or not-

(a)     an amount, transaction, event or item is taxable;

(b)     an amount or item is deductible or may be set-off;

(c)     a lower rate of tax than the maximum applicable to that class of taxpayer, transaction, event or item applies; or

(d)     an amount qualifies as a reduction of tax payable; and