Section 146 (TAA) – Circumstances where settlement is appropriate

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146.    Circumstances where settlement is appropriate

The Commissioner may, if it is to the best advantage of the state, ‘settle’ a ‘dispute’, in whole or in part, on a basis that is fair and equitable to both the person concerned and to SARS, having regard to-

(a)     whether the ‘settlement’ would be in the interest of good management of the tax system, overall fairness, and the best use of SARS’ resources;

(b)     SARS’ cost of litigation in comparison to the possible benefits with reference to the prospects of success in court;

[Paragraph (b) substituted by section 55 of Act 23 of 2015 effective on 8 January 2016]

(c)     whether there are any-

(i)      complex factual issues in contention; or

(ii)     evidentiary difficulties,

which are sufficient to make the case problematic in outcome or unsuitable for resolution through the alternative ‘dispute’ resolution procedures or the courts;

(d)     a situation in which a participant or a group of participants in a tax avoidance arrangement has accepted SARS’ position in the ‘dispute’, in which case the ‘settlement’ may be negotiated in an appropriate manner required to unwind existing structures and arrangements; or

(e)     whether ‘settlement’ of the ‘dispute’ is a cost-effective way to promote compliance with a tax Act by the person concerned or a group of taxpayers.

Section 145 (TAA) – Circumstances where settlement is inappropriate

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145.    Circumstances where settlement is inappropriate

 

It is inappropriate and not to the best advantage of the State to ‘settle’ a ‘dispute’ if in the opinion of SARS-

 

(a)     no circumstances envisaged in section 146 exist and-

 

(i)      the action by the person concerned that relates to the ‘dispute’ constitutes intentional tax evasion or fraud;

 

(ii)     the ‘settlement’ would be contrary to the law or a practice generally prevailing and no exceptional circumstances exist to justify a departure from the law or practice; or

 

(iii)    the person concerned has not complied with the provisions of a tax Act and the non-compliance is of a serious nature;

 

(b)     it is in the public interest to have judicial clarification of the issue and the case is appropriate for this purpose; or

 

(c)     the pursuit of the matter through the courts will significantly promote taxpayer compliance with a tax Act and the case is suitable for this purpose.

Section 143 (TAA) – Purpose of Part

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143.    Purpose of Part

 

(1)     A basic principle in tax law is that it is the duty of SARS to assess and collect tax according to the laws enacted by Parliament and not to forgo a tax which is properly chargeable and payable.

 

(2)     Circumstances may require that the strictness and rigidity of this basic principle be tempered, if such flexibility is to the best advantage of the State.

 

(3)     The purpose of this Part is to prescribe the circumstances in which it is appropriate for SARS to temper the basic principle and ‘settle’ a ‘dispute’.

Section 141 (TAA) – Abandonment of judgment

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141.    Abandonment of judgment

(1)     A party may, by notice in writing, lodged with the ‘registrar’ and the opposite party or the opposite party’s legal practitioner or agent, abandon the whole or a part of a judgment in the party’s favour.

[Subsection (1) substituted by section 38 of Act 33 of 2019]

(2)     A notice of abandonment becomes part of the record.

Section 140 (TAA) – Record of appeal of tax court decision

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140.    Record of appeal of tax court decision

 

(1)     The record lodged with a court to which an appeal against a decision of a tax court is noted, includes all documents placed before the tax court under the ‘rules’.

 

(2)     Documents submitted in the tax court which do not relate to the matters in dispute in the appeal may be excluded from the record with the consent of the parties.