Tax Administration Act

SARS must provide a progress report to the taxpayer during an audit or investigation

• TRUE

• FALSE

Answer explanation

S42

A taxpayer can request reasons for an assessment before lodging an objection.

• TRUE

• FALSE

Answer explanation

Rule 6

. A person who submits a false document to SARS is guilty of a criminal offense and may face imprisonment for up to 2 years.

• TRUE

• FALSE

Answer explanation

S234

If a taxpayer objects to an assessment, they are not required to pay the tax while the objection is pending.

• TRUE

• FALSE

Answer explanation

S164

Within how many business days must a taxpayer request reasons for an assessment?

• 45

• 15

• 60

• 30

Under Section 104, a taxpayer must object to an assessment within:

• 10 business days

• 21 business days

• 80 business days

• 45 business days

When can SARS extend the period for objection?

• When the taxpayer is dissatisfied with an assessment

• When SARS is satisfied there are reasonable grounds

• When the objection relates to administrative penalties

• When fraud or negligence is involved

Which of the following is considered a criminal offense under Section 234?

• Failure to pay tax on time

• Failure to submit a return

• Submitting a return under a forged signature

• Late payment of provisional tax

A taxpayer’s tax liability was R10,000,000, but due to an understatement, only R9,200,000 was assessed. Determine whether this constitutes a substantial understatement.

• YES

• NO

Answer explanation

Shortfall = R10,000,000 - R9,200,000 =

R800,000.

Test: Does it exceed the Greater of: ?

• 5% of R10,000,000 = R500,000

• R1,000,000.

No, the max is R1m

R800 000 < R1m

Taxpayers may object and appeal against:

• The imposition of a substantial understatement penalty

• SARS’ decision not to remit a substantial understatement penalty

• Both of the above

• None of the above

Answer explanation

s224