In a recent
Tax Court decision
, the Tax Court confirmed that taxpayers have a right to have
their disputes resolved in a court of law as enunciated in section 34 of the
Constitution. However, they cannot rely on this right when they are using
delaying tactics to prevent the matter from being heard.
regard, the South African Revenue Service (“SARS”) issued a revised assessment
to the taxpayer in 2013 based on the under-declaration of income. The
taxpayer’s objection to this assessment was disallowed and the taxpayer filed a
notice of appeal at the end of 2014.
meeting was then held at the beginning of 2017 and in July 2017 SARS filed its
statement of grounds of assessment.
The taxpayer appointed a
representative and requested an extension to April 2018 to file his statement
of grounds of appeal.
SARS, however, only granted extension until middle December
extension was requested by the taxpayer and by February 2018 SARS informed the
taxpayer of its intention to apply for a default judgement against the taxpayer
and thereafter obtained a date for the hearing in November 2018.
the hearing the taxpayer (via a new representative) requested that the matter
be postponed in order for him to obtain all relevant information. The Tax Court
granted such postponement until the end of February 2019 and ordered the
taxpayer to file his grounds of appeal on or before the date of the hearing. No
such grounds were filed. Also, on the date of the hearing, the taxpayer applied
for condonation and a further postponement to obtain information.
Court found that the taxpayer had sufficient information to lodge the objection
(in 2014 already) and that he was also not entitled to expand on his grounds of
appeal beyond that contained in his objection. The taxpayer also did not make
use of the proper rules for discovery of information
if he believed that he needed
additional information for his grounds of appeal.
Court held that the taxpayer was intentionally delaying the legal process in
order to prevent it from being finalised and disobeyed a court order without
providing substantial reasons for his non-compliance. SARS’ request for a
default judgement was therefore granted.
is that taxpayers must duly take note of the rules and timelines provided for
with regards to dispute resolution and that the courts (and likely SARS) will
not tolerate any unnecessary
TCIT 13868 BLF 27 February 2019.
In terms of Rule 31(2) of the rules promulgated under
section 103 of the Tax Administration Act, No. 28 of 2011. See Public Notice
550 (GG37819 of 11 July 2014).
In terms of Rule 32.
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)