Herewith a perfect example of the blatant disregard of South African Revenue Service to the rights of taxpayers, as enshrined in the PAJA Act, as well as the Constitution.
In this real example, we give you an excerpt of a real objection, to an audit from which we quote the relevant legislation.
The Tax Administration Act, is a vicious piece of Tax Legislation, and I do not in any way encourage falling foul of this act. But please be vigilant, and know your rights.
(Names and amounts not included.)
OBJECTION TO THE ASSESSMENT AND PENALTY IMPOSED ON XXXXXXXXX CC
You are referred to Chapter 2.3 of the Tax Administration and PAJA. It relates:
“The right to administrative justice under the constititution is given effect to in the Promotion of Administrative Justice Act(PAJA). In short this regulation mandates in the context of tax administration, that tax administrative actions that materially and adversely affect taxpayers right must-give clear grounds for the decision.”
Various emails were send requesting clarity, and nothing has been forthcoming. Herewith an excerpt of one of the emails, with the relevance to this case;
Objectionable points;1. Deductible expenses(Rx) totally overlooked.
2. The Rx reversal and the Rx “ deduction” was may I respectfully point out to befuddle and confuse. Refer to(PAJA clause in Tax Administration Legislation), “ that tax administrative actions that materially and adversely affect taxpayers right must-give clear grounds for the decision.”
3. Section 11(a)”Expenditure and losses actually incurred in production of income, provided such expenses are not of a capital nature.”
a) Municipal charges to the value of Rx, overlooked/included somewhere in the calculation. Either way it is not debatable. The municipal expenses were incurred, to derive income for the “rent collection, property investment company.
b) Rental, Agents commission, deliberately overlooked, and “hidden” in findings.
c) Project and contractual expenses.Information was furnished in this regard, but excluded, or only a portion allowed. It was not of a ‘capital nature”,
4. Wear and tear(Section 11e) read together with Practice Note 19. Completely overlooked, and “depreciation’’ used to calculate wear and tear, in complete violation of the Practice Note 19 Prescription. Our wear and tear calculation was Rx.
5. Total deductible expenses Rx.We acknowledge that SARS could uncover other “non deductible” amounts, but the difference between Rx and X) is just too huge, and warrants serious attention.
• Concluding remarks
Whilst we co operated fully with the audit procedure(that arrived at these questionable amounts) we are extremely concerned that this will be the trend of TAA.
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