MOVIMIENTO ARTÍSTICO
6.3 Prospectivas de futuro
12.1. How does extension of prescribed periods work?
In terms of rule 4 the taxpayer and SARS can by agreement agree to time periods except where the extension of a period prescribed under the TA Act or these rules is otherwise regulated in Chapter 9 of the TA Act or these rules. This would accordingly exclude, for example—
the period within which reasons for an assessment must be requested by the taxpayer (from date of assessment) – this is regulated under rule 6(3)
the period for providing the reasons for an assessment by SARS (45 days after delivery of request for reasons) - this is regulated under rule 6(5)
the period for lodging an objection by the taxpayer (30 days after date of assessment or date of receipt of reasons) - this is regulated under section 104(4) and rule 7(4)
the period for lodging a valid objection (20 days after delivery of notice by SARS that objection is invalid) - this is regulated under section 104(5)
the period of delivery of substantiating documents for the objection (30 days after notice by SARS requesting supporting documents) - this is regulated under rule 8
the period within which SARS must notify the taxpayer of its decision on the objection (60 days after delivery of the objection or 45 days after receipt of supporting documents if so requested) - this is regulated under rule 9
the period for the lodging of an appeal by the taxpayer (30 days after delivery of the notice of disallowance of the objection) - this is regulated under section 107(2)
the 21-day period within which a party must apply for a de novo hearing before the tax court if dissatisfied with the tax board’s decision under section 115.Periods which may be extended by agreement under rule 4 include, for example—
the 30-day period within which the taxpayer must respond to a test case notice by SARS under rule 12(3) any of the ADR periods under Part C of the rules
the 45-day period within which SARS must issue an assessment to give effect to the tax board decision under rule 28(5)
the 45-day period within which SARS must deliver its statement of grounds of assessment and opposing appeal under rule 31
the 45-day period within which the taxpayer must deliver its statement of grounds of appeal under rule 32 the period within which SARS must deliver its reply to statement of grounds of appeal under rule 33 any period related to discovery under rule 36
the periods within which notice must be given of expert witnesses and a summary of their opinions under rule 37
the period within which a pre-trial conference must be held and the period for delivery of the pre-trial minutes under rule 38
the 30-day period within which SARS must deliver the dossier under rule 40 the date of the hearing before the tax court under rule 45
any of the application on notice periods under Part F of the rules. A period under rule 4 may be extended by agreement between— the parties
a party or the parties and the clerk a party or the parties and the registrar.
A request for an extension must be delivered to the other party before expiry of the period prescribed under these rules unless the parties agree that the request may be delivered after expiry of the period.
If SARS is afforded a discretion under these rules to extend a time period applicable to SARS, SARS must in the notice of the extension state the grounds of the extension.
If a party does not agree to an extension of a time period, the requesting party may apply to the tax court under Part F of the rules for an extension order. Rule 52 provides that a taxpayer may apply to a tax court— if SARS fails to provide the reasons under rule 6 for an assessment required to enable the taxpayer to
formulate an objection under rule 7, for an order that SARS must provide within the period allowed by the court the reasons regarded by the court as required to enable the taxpayer to formulate the objection if an objection is treated as invalid under rule 7, for an order that the objection is valid
if the period of time to lodge an objection to an assessment has not been extended under section 104(4), for an order extending the period within which an objection must be lodged by a taxpayer subject to the provisions of section 104(5)
if the period of time to lodge an appeal to an assessment has been extended under section 107(2), for an order extending the period within which an appeal must be lodged by an appellant for a period not exceeding 45 days from the date of the order.
If a period is extended under this rule by an agreement between the parties or a final order pursuant to an application under Part F, the period within which a further step of the proceedings under these rules must be taken commences on the day that the extended period ends.221
12.2. How does condonation of non-compliance with the rules work?
Rule 52 provides that the tax court may upon application on notice, and on good cause shown, condone any non-compliance with these rules. This rule essentially ensures that a defaulting party can approach the tax court for condonation even before an application based on such default is brought against such defaulting party by the other party.
12.3. How may non-compliance with the rules be challenged?
Rule 52 makes provision for general relief and specific relief regarding non-compliance with the rules.
General relief222
Where either party fails to comply with any requirement contained in the rules the tax court may, upon application on notice by the other party, order the defaulting party to comply with that requirement within such time as the court deems appropriate. This includes an application for default judgment in the event of non-compliance with the rules.
Specific relief223
Where SARS fails to provide the reasons under rule 6 for an assessment required to enable the taxpayer to formulate an objection under rule 7, the court may order that SARS must provide within the period allowed by the court the reasons regarded by the court as required to enable the taxpayer to formulate the objection
Where an objection is treated as invalid under rule 7, the court may order that the objection is valid
Where the period of time to lodge an objection to an assessment has not been extended under section 104(4), the court may order the extension of the period within which an objection must be lodged by a taxpayer
221 Rule 4 222 Rule 52(1) 223 Rule 52(2)
Where the period of time to lodge an appeal to an assessment has not been extended under section 107(2), the court may order the extension of the period within which an appeal must be lodged by a taxpayer
SARS may for the purposes of rule 12 apply for an order that an objection or appeal be selected as a test case and that the objection or appeal be stayed pending the determination of the test case
A party to an agreement or settlement in terms of the ADR proceedings may apply for an order that the agreement or settlement be made an order of court or if SARS fails to issue the assessment to give effect to an agreement or settlement within the prescribed periods, for SARS to issue the assessment
A party who failed to deliver a statement of grounds of assessment and opposing appeal, statement of grounds of appeal or a reply to a statement of grounds of appeal, may apply to the tax court for an order condoning the failure to deliver the statement or reply and the determination of a further period within which the statement or reply must be delivered
A party seeking an amendment of a statement under rule 35 may apply to court for an appropriate order, including an order concerning a postponement of the hearing
A party may also apply to the tax court for an order as to whether items or portions of items in the bill of costs taxed under rule 47 may be allowed, reduced or disallowed
Application for the withdrawal of the chairperson of the tax board Application for the withdrawal of a member of the tax court.
Rule 56, in turn, makes provision for final relief regarding non-compliance with the rules by allowing for an application for default judgment in the event of non-compliance with the rules by either the taxpayer or SARS. For example, if SARS fails to deal with an objection within the periods prescribed under rule 9, the taxpayer may deliver a notice to SARS informing SARS of its intention to apply to the tax court for a final order in the event that SARS fails to remedy the default within 15 days of delivery of the notice. In the event that SARS fails to remedy the default within the prescribed period the taxpayer may apply, on notice to SARS, to the tax court for a final order under section 129 to the effect that SARS’s assessment or decision be altered unless SARS can show good cause for its default.
A recent case224 illustrates the tax court’s approach where SARS sought condonation for the late filing of a statement under old rule 10. The application was brought under old rule 26, which involved a more cumbersome process for final relief. Under this rule, the taxpayer first had to apply to the tax court for an order compelling SARS to deal with the appeal within the period prescribed by the court. Where the defaulting party fails to comply with the order made, the Tax Court may, upon further application on notice by the other party, finally deal with the appeal by allowing the objection and an order that SARS must alter the assessment in accordance with the objection. In delivering its judgment in favour of SARS, the court noted that it should be very careful to place a threshold at so high a level that it would result in the inability of SARS to prosecute what may well be a legitimate case regarding unpaid taxes from a party such as the taxpayer, that the public interest demands that all South African citizens pay their due taxes and that technical arguments should be placed in proper perspective. The court acknowledged that the purpose of the condonation application was to introduce some nature of pragmatism into the manner in which parties litigate and was of the view that the taxpayer’s insistence that the condonation application be made, postponed the matter unduly. The court concluded that this was not the kind of case where condonation should be refused and it would be a significant ‘overreach’ of the scope of the powers of the court to set aside SARS’s assessment.
Under rule 56 which specifically provides that the tax court may make an order under section 129(2), it is submitted that the court will not consider making a final order in favour of the taxpayer as an overreach of the scope of its powers.
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