Most Read Contributor in South Africa, September 2016
In terms of the "pay now, argue later" principle, the
South African Revenue Service (SARS) is entitled to collect amounts
owing by a taxpayer in terms of an assessment.
In terms of section 164 of the Tax Administration Act, 2011, a
taxpayer may request SARS to suspend the payment of tax.
If SARS does not allow the suspension, then SARS's decision
in this regard may be reviewed in terms of the provisions of the
Promotion of Administrative Justice Act, 2000. However, since it
may take several months for such review application to be heard, it
is necessary to either agree with SARS that it will not collect the
disputed tax until the finalisation of the review application or
apply for an interdict prohibiting SARS from collecting the
Depending on the timing of the payment required by SARS, it may
be necessary to obtain such an interdict on an urgent basis.
It is notoriously difficult to obtain urgent interdictory
relief, particularly in matters dealing with the suspension of
payment, given the "pay now, argue later" principle.
However, on 31 August ENSafrica successfully obtained such an
urgent interdict against SARS in the high court, preventing it from
collecting over R1-billion of tax pending the review.
This is a ground-breaking judgment as it shows that, despite the
"pay now, argue later" principle, it is possible to
ensure that, pending the finalisation of the review application, no
payment is made to SARS.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Effective collaboration amongst government agencies, automation of processes and capacity building by tax authorities have always been identified by stakeholders as strategies for achieving an efficient tax system.
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