Author: Ingé Lamprecht (Moneyweb) Deductions soon to be replaced by credits. JOHANNESBURG – The current tax filing season, which covers the 2014 tax year, marks the last time individuals will be able to claim a tax deduction for qualifying medical expenses.( From next year, this deduction will be replaced with a medical tax credit, similar to the one already applicable to medical aid contributions for taxpayers below the age of 65.
Category: Tax Returns
The Supreme Court of Appeal admonishes the South African Revenue Service
Author: Beric Croome Under the provisions of the Tax Administration Act, the Commissioner: South African Revenue Service (‘SARS’) is entitled to request that a taxpayer submits relevant material that SARS requires in terms of section 46 of the Tax Administration Act No. 28 of 2011 (‘TAA’). Section 1 of the TAA in turn defines ‘relevant material’ as meaning:
Remedy for declined tax clearance certificate
On 18 February 2014 the North Gauteng High Court delivered a judgment on the remedies available when a tax clearance certificate (‘TCC’) is declined by SARS. What is clear from the judgment is that when a taxpayer is dependent on a TCC for financial or business purposes and it gets declined by SARS, the potential impending economic harm that may come to a taxpayer from such refusal does not entitle the taxpayer to a court order compelling SARS to issue such a TCC sought.
Tax Administration Act – Tax clearance certificates
Taxpayers who wish to tender for State contracts do not qualify unless they can produce a valid tax clearance certificate. The refusal, withdrawal or non- renewal of such a certificate would consequently be the death knell of any business whose lifeblood is the securing of state tenders.
Changes to payroll tax forms submission to SARS
Manually completed payroll tax forms dropped-off at a SARS branch or posted, will no longer be accepted from 25 August 2014. The forms impacted include: Monthly Employer Declaration (EMP201) Employer Reconciliation Declaration (EMP501) Employee Tax Certificates [IRP5/IT3(a)] Tax Certificate Cancellation Declaration (EMP601) Reconciliation Declaration Adjustment (EMP701). Top Tip: An exception will be made for employers with a maximum of five IRP5/IT3(a)s. In such cases the employer can still go into a SARS branch where an agent will help them capture these IRP5/IT3(a)s and the EMP501.
Litigation with SARS – levelling the playing field
New rules governing the procedures to be followed in respect of objections and appeals, which are now prescribed in terms of section 103 of the Tax Administration Act, were published in the Government Gazette on 11 July 2014. One of the frustrations experienced by taxpayers involved in litigation with SARS is the fact that SARS frequently fails to deliver documents or decisions within the time limits prescribed in the rules governing the conduct of disputes.
SARS extends list of non-resident persons having to file an income tax return
On 25 June 2014 SARS issued its annual notice (‘Notice’) to specify which persons must file income tax returns for the 2014 year of assessment. The Notice was issued in terms of section 66 of the Income Tax Act (the ‘Act’), read together with section 25 of the Tax Administration Act. The 2014 year of assessment generally runs from 1 March 2013 to 28 February 2014.
Can SARS just say “Prove it”?
By Ian Wilson An important element in disputes between taxpayers and SARS is the burden of proof. This deals with identifying which of the parties must prove its case in order to succeed. In section 102(1) of the Tax Administration Act the burden of proof that an amount is exempt or is not otherwise taxable, or that an amount is deductible, rests on the taxpayer.
Supreme Court considers administrative fairness in tax disputes
On June 12 2014 an interesting judgment was handed down in the Supreme Court of Appeal (SCA) in Commissioner for the South African Revenue Service v Pretoria East Motors (Pty) Ltd (291/12) [2014] ZASCA 91. Facts The taxpayer operated a car dealership in Pretoria. The South African Revenue Service (SARS) conducted an audit of the taxpayer in respect of its 2000 to 2004 years of assessments, and raised various additional assessments in respect of income and value added tax (VAT), among other things. SARS also imposed punitive additional tax of 200%. The taxpayer objected to the additional assessments, but SARS disallowed the objection. The taxpayer appealed to the Tax Court.
SARS tax audits, the Tax Administration Act and making an effort to understand the taxpayer’s business operations
The recent decision of the Supreme Court of Appeal (“SCA”) in the matter of SARS v Pretoria East Motors (Pty) Ltd (291/12) [2014] ZASCA 91 is important insofar as it deals with SARS’s obligations when conducting a tax audit. (The SCA judgment by Ponnan JA was delivered on 12 June 2014).