• Posted on Feb 28, 2018

According to Erasmus, the main issue was that SARS failed to issue a letter of findings at the conclusion of a tax audit (sections 40 and 42 of the Tax Administration Act), and so the court set aside the assessment with costs against SARS.

Leading tax attorney Dr Daniel Erasmus, together with Port Elizabeth based legal firm Strombeck Pieterse Attorneys won a case against SARS with costs on behalf of a taxpayer. The judgment was given on 08 February 2018 and has been redacted due to it being argued in the Tax Court.

Read: SA Tax case 2018 Judgment section 42 TAA et al_Redacted

According to Erasmus, the main issue was that SARS failed to issue a letter of findings at the conclusion of a tax audit (sections 40 and 42 of the Tax Administration Act), and so the court set aside the assessment with costs against SARS.

The assessment was raised based on a high retrenchment package of a CEO which SARS said was taxable (in excess of R7m) and adding back of substantial farming expenses SARS said were not deductible. These issues were not advanced in the judgment due to SARS failure to adhere to the peremptory administrative procedures prescribed in the Tax Administration Act. This is thus a significant judgment in administrative/constitutional law as it applies to tax and the raising of assessments.

Dr Erasmus is the principal tax legal adviser to Tax Risk Underwriting Managers.

Make sure your rights are protected by leading tax experts when you are selected for audit by SARS – at a fraction of the costs. Get covered by tax risk insurance now!

https://www.africataxjournal.com/?p=628