The Tax Administration Act (TAA) allows you to lodge an objection when you disagree with SARS' assessment on your Vat affairs. And it also allows you to ask for an extension if your objection is late.
But, asking for an extension isn't that straightforward.
You have to prove two things to qualify.
Read on to find out what they are...
You'll only qualify for a late objection extension if you can prove these two things
According to the Practical Vat Loose Leaf Service
, to qualify for an extension for a late objection
, you must prove that:
There are reasonable grounds for the delay. That's if you want an extension of less than 21 business days; and
Exceptional circumstances exist for the delay. That's if you're asking for an extension of more than 21 business days.
So what are 'reasonable grounds' and 'exceptional circumstances? How will you know if you meet the criteria?
The Practical Vat Loose Leaf Service
says, reasonable means 'having sound judgment, moderate, ready to listen to reason, not absurd, within the limits of reason, not greatly less or more than might be expected, tolerable and fair.'
While the courts have held that there's no absolute standard of reasonableness and that it depends on the circumstances of each case, you must have a compelling reason for SARS to consider your extension.
When the Tax Administration Act (TAA)
talks about 'exceptional circumstances', it means something unusual. (Refer to Section 218(2)
of the TAA
to get examples of exceptional circumstances.)
Just bear in mind that SARS won't extend the objection period in these instances
If it's more than three years since the date of assessment; or
You're basing your objection on a change in a practice applied on the date of assessment.
Now that you know the two things you must prove to qualify for a late objection extension, remember these points about lodging an objection…
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Remember these points about lodging an objection
When you lodge your objection, you must use the prescribed ADR 1 form;
Your objection must be in writing and must specify the legal grounds of your objection;
It must clearly state which figure you're disputing and what you believe the figure should be; and
You must sign it and submit to SARS so it can make its decision. .
If you're unable to sign the objection or appeal and another person is signing on your behalf, you must declare the following on the dispute form:
The reason why you can't sign the dispute (objection or appeal);
That the representative has the necessary power of attorney to sign on your behalf; and
That you're aware of the dispute and agree with the grounds thereof.
There you have it: You'll only qualify for a late objection extension if you prove the two things above. To be on the safe side, we advise you always lodge your objection as soon as possible.
PS: For more information on objections, check out the Practical Vat Loose Leaf Service