In a recent application to the Johannesburg Tax Court (018/2016), the court was asked to condone an appeal submitted late by the taxpayer.
The facts are simply that the taxpayer filed an appeal more than 75 business days after the notice of disallowance of the taxpayer’s objection. The reason for late submission is that the taxpayer’s representative thought that the appeal was filed on e-filing but later discovered that it was not filed due to an internet connection problem.
Should SARS condone a late appeal and When?
SARS opposed the application stating that it has no discretion to extend the period for lodging an appeal beyond a period of 75 days from the date of the disallowance of an objection. This, SARS argued, was due to the wording of section 107 of the Tax Administration Act, No. 28 of 2011 (“the TAA”) which states that SARS may only extend the period for lodging an appeal for up to a maximum of 45 business days if exceptional circumstances exist. Since an appeal is due within 30 days from date of disallowance of the objection, SARS cannot condone an objection filed more than 75 days after the notice of disallowance.
The taxpayer, in turn, argued that the 45 days by which the period may be extended runs not from the date of the disallowance of the objection but rather from the date of the taxpayer’s request for extension of the period to lodge the appeal. The court agreed with the taxpayer’s interpretation of section 107 and, seemingly without considering whether a broken internet line constitute exceptional circumstances for the purposes of section 107, condoned the taxpayer’s late appeal.
There are, no doubt, hundreds if not thousands of taxpayers who have been told that a late appeal cannot be condoned by SARS post the 75-business day period. Given that this has mostly been accepted as the correct position in law, it is likely that these cases were not pursued much further, if at all. In light of this judgment, however, and depending on the circumstances, these taxpayers may well have good cause to consider objecting to a decision by SARS not to condone a late appeal or even bringing an application.
Unicus Tax Specialists SA, has, at the time of writing, always been able to secure a satisfactory outcome for our clients in their disputes with SARS, thereby saving our clients hundreds of millions of rands in taxes, penalties and interest.
Author: N Theron
