Visit the national COVID-19 Online Resource and News Portal at www.sacoronavirus.co.za or see SARS COVID-19 news items and tax relief measures here.

What’s New at SARS

Media Release – SARS tackles non-compliant PPE companies

8 October 2021 – The South African Revenue Service (SARS) has recently been focussing on 52 non-compliant companies that received R1-billion in contracts for the supply of personal protective equipment (PPE) and other Covid-19 related services.

To date, 11 companies have been convicted, 7 cases are currently on the court roll, 29 cases are with the National Prosecution Authority (NPA) for the drafting of charge sheets and/or warrant of arrests, while 5 case dockets are being processed by the Hawks.

See the full statement here.

Legal Counsel – Secondary Legislation – Rule Amendments 2021

8 October 2021 – Customs & Excise Act, 1964: Amendment to rules under section 120 – Substitution of form DA 185 – Application form: Registration/Licensing of Customs and Excise Clients (DAR222)

Legal Counsel – Dispute Resolution & Judgments – Tax Court – Tax Court: 2022-2020

8 October 2021 – Tax Court Judgments 2022-2020:

  • SARSTC 14232 (IT) [2021] Johannesburg (16 July 2021) – Whether income was to revenue or capital in nature
  • SARSTC VAT 1908 (VAT) [2021] Cape Town (21 June 2021) – Whether the appellant was correct in deeming a supply as exempt
  • SARSTC IT 24888 (ADM) [2021] Cape Town (18 June 2021) – Whether the respondent was entitled to charge a 25% understatement penalty on the taxpayer
  • SARSTC 24682 (ADM) [2021] Cape Town (4 June 2021) – Whether the appellant was entitled to a continuance of the matter
  • SARSTC IT 25242 (IT) [2021] Johannesburg (31 May 2021) – Whether the appellant was entitled to deductions and waiver of penalty
  • SARSTC 0092-2019 (ADM) [2021] Johannesburg (31 May 2021) – Whether the applicant was entitled to amend its objection
  • SARSTC IT 25390 (IT) [2021] Johannesburg (18 May 2021) – Whether the appellant was entitled to be deemed to be a public benefit organisation (PBO)

Legal Counsel – Dispute Resolution & Judgments – Supreme Court of Appeal (SCA) – Supreme Court of Appeal: 2022-2020

8 October 2021 – Customs & Excise Act, 1964:

Revenue – Customs and Excise Act 91 of 1964 (the Act) – diesel fuel concession – entitlement to a refund of diesel fuel levy used for primary production in mining – interpretation and ambit of Note 6(f)(iii) of Item 670.04 in Part 3 of Schedule 6 to the Act – claim by entity engaged in mining activities for diesel rebates in respect of period between August 2011 and 13 December 2013 – claim disallowed by Commissioner on grounds that the activities in respect of which claim submitted not constituting primary production activity in mining within ambit of Note 6(f)(iii) but related to secondary activities in mining – decision by the high court overturning the Commissioner’s determination and instead holding that taxpayer entitled to a refund of diesel fuel levy for the relevant period reversed on appeal

Submitting an application for Tax Exemption

7 October 2021 – To submit an application for exemption at your nearest  SARS Branch Office, request an online appointment booking and select ‘Telephonic engagement’ for the Appointment Channel, then ‘Other’ for the ‘Reason Category’ and then ‘Application for Exemption (EI1)’ as a reason for the appointment. This option was temporarily unavailable and has been restored. Once the appointment has been made, a case reference number will be issued which must be used to upload the application forms and supporting documents on the SARS Online Query System (SOQS). SARS will be in contact with the applicant to confirm the type of appointment and confirm if all the required documents have been uploaded.

Once you have uploaded to documents, email the case number to the following email address for processing: [email protected].

For more information, see our webpage on Tax Exemption Institutions.

Customs – Automated controls for Rebate Item 536 during the COVID-19 pandemic

7 October 2021 – The purpose of this letter is intended to ease and stream line the Original Equipment Manufacturer (OEM) report stamp requirement under refund claim 536 and to provide control measures during the COVID pandemic and beyond through limiting physical contact, giving direct access and allowing for an automated assessment/verification as a control measure for Customs officers to perform their legislative and operational requirements for verification and assessment. See the Letter to Trade.

Legal Counsel – Dispute Resolution & Judgments – High Court – High Court: 2022-2020

6 October 2021 – High Court Judgments 2022-2020:

  • Peri Formwork Scaffolding Engineering (Pty) Ltd v CSARS (A67/2020) [2021] ZAWCHC 165 (23 August 2021)
  • Public Protector South Africa v CSARS (84074/19) [2021] ZAGPPHC 467 (15 July 2021)
  • Reddy v CSARS and Another (EQ 19443/21) [2021] ZAGPPHC 468 (12 July 2021)
  • PFC Properties (Pty) Ltd and Another v CSARS (81483/2019) [2021] ZAGPPHC 419 (17 June 2021)
  • JMN v CSARS (A3096-2019 & 14001) [2021] ZAGPJHC 167 (30 April 2021)
  • CSARS v Raphela and Others (2091/2021) [2021] ZAGPPHC 191 (29 March 2021)
  • Dragon Freight (Pty) Ltd and Others v CSARS and Others (13584/2020) [2021] ZAGPPHC 197 (17 March 2021)
  • CSARS v Louis Pasteur Investments (Pty) Ltd and Others (12194/17) [2021] ZAGPPHC 89 (4 March 2021)
  • CSARS v Hamiltonn Holdings (Pty) and Others (2020/35696) [2021] ZAGPPHC 138 (1 March 2021)
  • Dragon Freight (Pty) Ltd and Others v CSARS and Others (13584/20) [2020] ZAGPPHC 745 (11 December 2020)
  • CV v CSARS (A322/2019) [2020] ZAWCHC 140 (30 October 2020)
  • Glencore Operations (Pty) Ltd v CSARS (11696/2018) [2020] ZAGPPHC 45 (12 February 2020)

Legal Counsel – Preparation of Legislation – Draft Documents for Public Comment

6 October 2021 – Customs & Excise Act, 1964: Draft Schedule amendment to amend –

  • Part 1 of Schedule No. 1 – Super fine maize meal

Due date for public comment: 7 November 2021

Media release: Businessman gets 5-year jail term for VAT fraud

6 October 2021 – A businessman who used false tax invoices in the calculations of VAT Output and Input tax was sentenced to five years direct imprisonment for fraud this week. See the media release: Businessman gets 5-year jail term for VAT fraud.

Invitation: Webinar – Illicit Trade and Counterfeit Procedures

5 October 2021 – Dear Traders and Travellers, SARS invites you to join a webinar discussion on Illicit Trade and Counterfeit Procedures. SARS as an agency of government is concerned about the rate of illicit trade activities as well as handling procedures on counterfeit commodities. Illicit trade activities have such a negative impact on the country’s economy. The national lock-down has worsened the illicit trade and counterfeiting trends, resulting in job losses in our communities and financial losses to legitimate businesses.

The details of the event are as follows:

Theme: Illicit Trade and Counterfeit procedures
Date: Thursday, 7 October 2021
Time: 17:00 – 19:00
Livestream on YouTube:  https://youtu.be/oS3JjLohOHE

If you have questions on Illicit trade and counterfeit procedures, please email [email protected]

Tender

4 October 2021 – Extension notification:  RFP11/2021Request for proposals for the appointment of a qualified service providers for the provision of integrated hygiene and specialised cleaning, waste management, pest control and gardening services at SARS offices.

Updated [email protected] Employer version released

4 October 2021 – An updated [email protected] Employer version 7.1.7 was released. The changes are:

• An updated version of the EMP501 Form that includes Covid Relief allowances on ETI
• Correction to wording for error messages related to source code 7007
• Correction to manual capture validation of tax directives for tax years 2021 and older
• Correction to the IRP5/IT3a “View” button that was deactivated under specific circumstance
• Adjustment to manual capture validation related to commas in demographic fields to align with import and pre-submission validation
• Adjustment to submission process where users incorrectly selected a future period and deregistration reason and date
• Adjustment to layout of ETV report to allow feedback on up to five Tax Directives as specified in the SARS PAYE BRS V 20
• Correction to the IT Registration process to allow users to select “IT Reg” from the employee demographics page
• Adjustment to EMP501 submission files to ensure that cents/decimals are excluded for Tax Directive values

Legal Counsel – International Treaties & Agreements – Double Taxation Agreements & Protocols

1 October 2021 – Income Tax Act, 1962: Status overview of all DTAs and Protocols – Multilateral Convention to implement tax treaty related measures to prevent base erosion and profit shifting (MLI) Synthesised Texts

Customs Clearance Declarations

30 September 2021 – The acquittal process of bonded and transit goods has been enhanced.  The information previously published in SC-TR-01-02 and SC-TR-01-03 has been inserted in SC-CF-54 and SC-CF-55 respectively, if it is still relevant to the new acquittal process.

Customs will, on a risk based approach, stop goods that are in bond or in transit through South Africa and request supporting documents.  A Documentary Inspector will forward the case for a physical inspection.  The case will then be conditionally released. Proof that the goods were exported from South Africa or has left the Southern African Customs Union (SACU) must be uploaded by the declarant to the case within thirty (30) days.

The completion of declaration manual (SC-CF-04) and its annexures have been re-numbered and is included as annexures in the external clearance declaration policy (SC-CF-55).  The Facility Code List SC-CF-04-A08 has been renumbered as SC-CF-19-A02 and incorporated into the external registration, licensing and designation policy (SC-CF-19).

The printing of CN1 and CN2 at land-border posts are no longer part of the process.

The annexures are attached to external policies.

See the updated documents:

Reporting of Conveyances of Goods

30 September 2021 – The Reporting of Conveyances of Goods External Policy has been updated. This revision includes the Number plate recognition (NPR) cameras.  Number plate recognition (NPR) cameras will mark trucks for arrival or exit at land border-posts where the system has been rolled out.  The reporting of conveyances and goods process has been updated to include the NPR process.  Where the NPR cameras are not installed the gate-in and gate-out process must still be followed by the Customs Officer.

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