Page 169 - Juta's Indirect Tax

s 217 TAX ADMINISTRATION ACT 28 OF 2011 s 222
(2) In the case of a ‘penalty’ imposed under section 212, the R2 000 limit referred to in subsection (1) is changed to R100 000.
(3) If a ‘penalty’ has been imposed under section 213, SARS may remit the ‘penalty’, or a portion thereof, if SARS is satis ed that—
(a) the ‘penalty’ has been imposed in respect of a ‘ rst
incidence’ of non-compliance, or involved an amount
of less than R2 000;
(b) reasonable grounds for the non-compliance exist; and
(c) the non-compliance in issue has been remedied.
[Sub-s. (3) substituted by s. 72 (b) of Act 21 of 2012 – date of commencement deemed to have been 1 October 2012.]
218 Remittance of penalty in exceptional circumstances
(1) SARS must, upon receipt of a ‘remittance request’, remit the ‘penalty’ or if applicable a portion thereof, if SARS is satis ed that one or more of the circumstances referred to in subsection (2) rendered the person on whom the ‘penalty’ was imposed incapable of complying with the relevant obligation under the relevant tax Act.
(2) The circumstances referred to in subsection (1) are limited to—
(a) a natural or human-made disaster;
(b) a civil disturbance or disruption in services;
(c) a serious illness or accident;
(d) serious emotional or mental distress; (e) any of the following acts by SARS:
(i) a capturing error; (ii) a processing delay;
(iii) provision of incorrect information in an of cial publication or media release issued by the Commissioner;
(iv) delay in providing information to any person; or (v) failure by SARS to provide suf cient time for an adequate response to a request for information
by SARS;
(f) serious nancial hardship, such as—
(i) in the case of an individual, lack of basic living requirements; or
(ii) in the case of a business, an immediate danger that the continuity of business operations and the continued employment of its employees are jeopardised; or
(g) any other circumstance of analogous seriousness.
219 Penalty incorrectly assessed
If SARS is satis ed that a ‘penalty’ was not assessed in accordance with this Chapter, SARS may, within three years of the ‘penalty assessment’, issue an altered assessment accordingly.
220 Objection and appeal against decision not to remit penalty
A decision by SARS not to remit a ‘penalty’ in whole or in part is subject to objection and appeal under Chapter 9.
CHAPTER 16 UNDERSTATEMENT PENALTY (ss. 221–233)
Part A
Imposition of understatement penalty (ss. 221–224)
221 De nitions
In this Chapter, unless the context indicates otherwise, the following terms, if in single quotation marks, have the following meanings:
Juta’s IndIrect tax 2016
‘repeat case’ means a second or further case of any of the behaviours listed under items (i) to (v) of the understatement penalty percentage table re ected in section 223 within ve years of the previous case;
‘substantial understatement’ means a case where the prejudice to SARS or the scus exceeds the greater of ve per cent of the amount of ‘tax’ properly chargeable or refundable under a tax Act for the relevant tax period, or R1 000 000;
‘tax’ means tax as de ned in section 1, excluding a penalty and interest;
‘tax position’ means an assumption underlying one or more aspects of a tax return, including whether or not—
(a) an amount, transaction, event or item is taxable;
(b) an amount or item is deductible or may be set-off; (c) a lower rate of tax than the maximum applicable
to that class of taxpayer, transaction, event or item
applies; or
(d) an amount quali es as a reduction of tax payable; and
‘understatement’ means any prejudice to SARS or the scus as a result of—
[Words preceding para. (a) substituted by s. 74 of Act 39 of 2013 – date of commencement deemed to have been 1 October 2012.]
(a) a default in rendering a return;
(b) an omission from a return;
(c) an incorrect statement in a return; or
(d) if no return is required, the failure to pay the correct
amount of ‘tax’.
222 Understatement penalty
(1) In the event of an ‘understatement’ by a taxpayer, the taxpayer must pay, in addition to the ‘tax’ payable for the relevant tax period, the understatement penalty determined under subsection (2) unless the ‘understatement’ results from a bona de inadvertent error.
[Sub-s. (1) substituted by s. 75 (a) of Act 39 of 2013 – date of commencement deemed to have been 1 October 2012.]
(2) The understatement penalty is the amount resulting from applying the highest applicable understatement penalty percentage in accordance with the table in section 223 to each shortfall determined under subsections (3) and (4) in relation to each understatement in a return.
[Sub-s. (1) substituted by s. 75 (a) of Act 39 of 2013 – date of commencement deemed to have been 1 October 2012.]
(3) The shortfall is the sum of—
(a) the difference between the amount of ‘tax’ properly
chargeable for the tax period and the amount of ‘tax’ that would have been chargeable for the tax period if the ‘understatement’ were accepted;
[Para. (a) substituted by s. 75 (b) of Act 39 of 2013 – date of commencement deemed to have been 1 October 2012.]
(b) the difference between the amount properly refundable for the tax period and the amount that would have been refundable if the ‘understatement’ were accepted; and
(c) the difference between the amount of an assessed loss or any other bene t to the taxpayer properly carried forward from the tax period to a succeeding tax period and the amount that would have been carried forward if the ‘understatement’ were accepted, multiplied by the tax rate determined under subsection (5).
(4) If there is a difference under both paragraphs (a) and (b) of subsection (3), the shortfall must be reduced by the amount of any duplication between the paragraphs. [Sub-s. (4) substituted by s. 75 (c) of Act 39 of 2013 – date of commencement deemed to have been 1 October 2012.]
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TAX ADMINISTRATION ACT