Following allegations of impropriety involving Sars commissioner Oupa Magashula Retired Constitutional Court judge Zak Yacoob has been appointed to probe allegations of impropriety involving Sars commissioner Oupa Magashula, Finance Minister Pravin Gordhan said on Tuesday.
Tag: SARS
South African Trade Statistics for February 2013
The South African Revenue Service (SARS) today releases trade statistics for February 2013 that record a trade deficit of R9.52 billion. Summary The R9.52 billion deficit for February 2013 can be attributed to exports of R62.32 billion and imports of R71.84 billion. Exports increased from January to February by R9.04 billion (17.0%) and imports decreased from January to February by R5.97 billion (-7.7%). The reduction in the trade deficit from R24.5 billion in January 2013 was due to an increase in exports of mineral products, chemical products, precious metals and machinery and electrical appliances. Imports decreased in the following sections: prepared foodstuffs, chemical products, plastics and rubber, machinery and electronics and vehicles, aircraft and vessels. The cumulative deficit for 2013 is R34.11 billion compared to R23.71 billion in 2012.
Caught on tape: Tax boss and drug dealer
Cosy liaison with head of Sars revealed in jobs-for-pals scandal SA Revenue Service (Sars) boss Oupa Magashula is at the centre of a jobs-for-pals scandal involving a convicted drug dealer who is allegedly a police informant. In a clandestine recording laced with sexual innuendo, a copy of which City Press has in its possession, Magashula and Panganathan “Timmy’’ Marimuthu offer a 28-year-old woman from Marimuthu’s charismatic church a R700 000-a-year Sars post. Sars officials this week confirmed the authenticity of the recording, but claim their boss’ hands are clean and Marimuthu set him up.
Recent case on judicial review of SARS’ actions in terms of PAJA
By Hanneke Farrand and Esther Geldenhuys, ENS – Edward Nathan Sonnenbergs The South African Revenue Service (“SARS”) increased their audit activity and focus on the collection of tax. Taxpayers often rely on protection in terms of administrative law and in particular, the Promotion of Administrative Justice Act, No. 3 of 2000 (“PAJA”). An important rule under PAJA is that judicial review can only be used as a last resort after all other internal remedies have been exhausted and taxpayers therefore first have to make use of the objection and appeal procedures provided for in the Tax Administration Act, No. 28 of 2011. The case outlined below highlights the nature of some of SARS’ actions that may be brought under judicial review in terms of section 6 of PAJA and the circumstances under which such a review application might be dismissed.
Maintenance contracts: making commercial sense of section 24C
The Commissioner of the South African Revenue Service (“the Commissioner”) has recently published a Draft Interpretation Note (“the Draft”) on the allowance of future expenditure on contracts in terms of section 24C of the Income Tax Act 58 of 1962 (“the Act”). In the Draft the Commissioner has taken a firm view on what he regards as “a high degree of probability and inevitability” that expenditure will be incurred, especially with regards to maintenance contracts.
Tax could jettison attempts at business rescue
Business rescue will not be a viable option for companies in distress, until amendments are made to the Income Tax Act and VAT requirements. Any benefit that financially distressed companies could potentially derive from business rescue might be nullified by the tax implications of certain common business rescue processes. “In fact, unless amendments are made to the Income Tax Act and VAT requirements, successful business rescue will often not be possible,” says Dawid van der Berg of tax, auditing and business advisory company BDO.
SARS : Basic Guide to Income Tax for PBO and Donations deductions
In South Africa, an organisation that has a non-profit motive or is established or registered as a non-profit organisation does not automatically qualify for preferential tax treatment. An organisation will only enjoy preferential tax treatment after it has applied for and been granted approval as a Public Benefit Organisation (PBO).
Draft Interpretation Note: Deduction of expenditure incurred on repairs
SARS recently published Draft Interpretation Note on in which it seeks to provide guidance on the interpretation and application of section 11(d) which allows a deduction for expenditure incurred on repairs for the purposes of trade. Expenditure on repairs to an asset not comprising trading stock is likely to be of a capital nature, particularly when it is not incurred at regular intervals.
Draft Interpretation Note: determining a 'group of companies' for purposes of the corporate rules
This Draft Note when published as final one will provides guidance on the interaction of the definitions of a “group of companies” contained in sections 1(1) and 41(1). The corporate rules contain, amongst other things, special provisions relating to the income tax consequences (including capital gains tax consequences) of transactions between companies forming part of a “group of companies”. Under qualifying circumstances, the corporate rules make it possible for companies in such a group of companies to transfer assets between each other without adverse tax consequences.
Do your objections and appeals to Sars correctly
Do your objections and appeals to Sars correctly ..… or else it could become very costly. The taxpayer in H R Computek (Pty) Ltd v CSars (830/2011) [2012] ZASCA 178 learnt a painful and expensive lesson about the importance of adhering to the rules and provisions relating to objection and appeal. In particular, this judgement reminds taxpayers, not for the first time, that the grounds of your objection are extremely important because you are stuck with them all the way through the judicial process.