In a recent article from Moneyweb, a taxpayer learned a costly lesson in tax court: the importance of attention to detail when objecting to an assessment from the South African Revenue Service (SARS).
Not only did SARS invalidate the taxpayer’s objection twice, but the Western Cape Tax Court also dismissed his application for a declaratory order, ruling that his objection was not valid. The taxpayer’s troubles began in 2021 when SARS audited his financial affairs, resulting in assessments for personal income tax, value-added tax (VAT), and donations tax over a four-year period.
SARS invalidated his objections on the grounds that the taxpayer violated Rule 7(2) of the tax court, which outlines the requirements for a valid objection. In his objection, the taxpayer submitted only the documentation he deemed necessary to support his case.
Judge Sheldon Magardie was critical in his judgment, emphasising that the taxpayer failed to meet the overarching requirement for “detail” in the grounds of his objection. The rule clearly states that the taxpayer must “specify in detail” the specific part or amount of the assessment being contested. Consequently, a “globular, vague and unspecific” objection does not satisfy the requirements of the rule. “In my view, all of these requirements—specificity in formulating the grounds of objection and submitting necessary documents—are aimed at ensuring that SARS can properly assess the merits of the objection and decide whether to allow or disallow it in whole or in part,” stated Magardie.
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Read the full Moneyweb article here.
Source: Tax Risk Insurance
