HomeHome SearchSearch MenuMenu Our productsOur products

Four things SARS must prove before attacking you for tax evasion

by , 14 September 2015
You have a right to organise your affairs so as to incur the least tax liability.

But there is a fine line between what is legal and illegal in this area with SARS putting aside the three-year prescription period and setting penalties as high as 200%!

In taking tax avoidance measures, SARS will refer to Section 80 A80-L of the Income Tax Act.

But before SARS can attack you in terms of this Section, it must prove the following four things:

1. SARS must prove that it was an arrangement.
 
2. It must prove that the arrangement results in a tax benefit.
 
*****Advertisement*****

Avoid 200% tax penalty
 
 
**********************
 
 
3. SARS must prove that the only or main purpose of the arrangement is to experience a tax benefit.
 
4. If the arrangement falls within a business context, then one of the following four conditions must be met: 
 
Means and manners that are not usually done; 
Rights and obligations not usually created; 
There is no or a lack of commercial substance; or
Misusing or abusing provisions within the Income Tax Act.
 

So, there were four things that SARS has to prove before attacking you for tax evasion. Be aware of them and allow this knowledge to enhance your functioning. 

To learn more, click below…
 
*****Advertisement*****

How much time do you spend looking for useful tax information? Do you need all the South African taxes analysed and explained in one easy location? 
 
Now you can have all the information in one place: The Practical Tax Loose Leaf Service.
Over 500 pages compiled by our tax experts, comprising of: 
 
All the definitions and legal regulations, useful advice, exceptions to the rules that help you slip through the legislative jungle of taxes. 
Case studies and practical examples that show you what elements you should consider for your taxes to be perfect.
Red flags you need to watch out for and the penalties you'll face if you don't respect them.
Sample templates at your disposal, ready to be filled in, customised and printed. 
 
You will also get free access to the accountingandtaxclub.co.za. Here you'll find questions and answers on any tax and accounting issues.
You can also ask our experts a tax question 
 
 
**********************
 

Vote article

Four things SARS must prove before attacking you for tax evasion
Rating:
Note: 5 of 1 vote


Related articles




Related articles



Related Products