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APPEAL

APPEAL

30 Aug 2018

When SARS issued an assessment with which the taxpayer is not in agreement with, certain procedures must be followed to ensure that the assessment is correctly dealt with. We will elaborate on the different options and timeframes which a taxpayer must adhere to.

When to submit?

Once the taxpayer has decided to appeal against the disallowance of the objection or part of the objection, the matter will proceed on appeal to the tax board or tax court unless the taxpayer and SARS agree to use alternative dispute resolution (ADR).

The taxpayer must provide sufficient reasons to support the grounds for disputing the basis of the disallowance by SARS but cannot introduce a new ground at the appeal stage.

How long do you have?

The appeal must be delivered to SARS within 30 days after receipt of the notice of disallowance of the objection. The taxpayer may apply for extension before the expiration of the 30-day period. SARS can then extend the period either by 21 days if reasonable grounds exist or 45 days if exceptional grounds exist.

How long does SARS have to respond?

SARS will send a request for alternative dispute resolution (ADR) within 30 days after the appeal was delivered by the taxpayer.

The taxpayer has 30 days to accept the ADR.

The proceedings commence once the parties agree to accept the ADR. It is important to note that representations made at ADR are without prejudice and is merely an informal mechanism, which is highly recommended, to resolve the dispute prior to proceeding to tax court or tax board which can be a rather expensive process.

The ADR must be completed within 90 days of commencement unless the parties agree to an extension.

If on termination of the ADR the parties do not reach agreement, the matter will proceed to be set down for hearing before the tax board. The taxpayer must appear in person if a natural person or be represented by the representative taxpayer if a juristic person. A third party who prepared the return involved in the assessment or decision in appeal may also appear on the taxpayer’s behalf. Should the taxpayer wish to have another person appear on his behalf he would have to request permission with his notice of appeal.

The Chairperson must prepare a statement within 60 days of the decision that includes the findings of fact and reasons for the decision. The clerk must then within 10 days after receipt of the decision send a copy to both parties. If no further appeal follows, SARS must within 45 “days” of delivery of the decision issue an amended assessment if the ADR proceedings went in favour of the taxpayer.

Should the parties not be satisfied with the decision or if the Chairperson fails to reach a decision within 60 days then either party may deliver a notice, within 21 days, that the matter be referred to the tax board or tax court.

“Day” means a business day as defined in section 1 of the TAA and constitutes a day other than Saturday, Sunday or public holiday and, for the purpose of complying with the periods allowed in Chapter 9 (i.e. Dispute resolution), excludes the days between 15 December of each year and 16 January the following year.


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