COURT ORDERS TAXPAYER TO RESPOND TO SARS REQUEST TO COMPLETE THE LIFESTYLE QUESTIONNAIRE

rich%20and%20famous-5-5-13It is becoming ever more apparent that SARS is taking its tax audit functions very seriously. This creates a risk for anyone who pays tax.

As reported in the Business Day of June 2016, the High Court delivered judgment on 5 May directing a taxpayer to submit a response to a Lifestyle Questionnaire submitted to him by SARS.

In this matter, the taxpayer contended that he had shown just cause for his refusal to respond to the Lifestyle Questionnaire. The taxpayer contended that SARS was seeking to conduct an unlawful fishing exhibition and was not entitled to the information as the request constituted an infringement of the taxpayer‘s constitutional rights set out in the Bill of Rights.

The court reviewed the arguments raised by SARS and the taxpayer, and came to the conclusion that the issuing of the Lifestyle Questionnaire was done in the course of the administration of a tax Act and was therefore satisfied that all of the jurisdictional facts contained in section 46 had been complied with.

Matters such this are most often complex in the extreme. In reading the full article here, it becomes apparent that the playing fields aren’t level. SARS has all the resources in the world available to them to take taxpayers on. Unfortunately, taxpayers most often do not have access to the same or similar resources to balance the scales.

This creates a risk for everyone who pays tax. Fortunately, it is a risk which you can now insure against. Tax risk insurance provides taxpayers with access to some of the best tax and legal minds in South Africa who will represent you in the event of a SARS tax audit. Contact our office for assistance +27 11 484 9401