Section 164(3) of the Tax Administration Act 28 of 2011 (hereafter TAA) provides a senior South African Revenue Service official (hereafter, respectively, SARS and senior SARS official) with discretionary powers to suspend the payment of disputed tax or a portion thereof, having regard to relevant factors, if the taxpayer intends to dispute the liability to pay such tax. Making a decision in terms of section 164(3) of the TAA constitutes administrative action. Section 33(1) of the Constitution of the Republic of South Africa, 1996 (hereafter Constitution) grants everyone the right to just administrative action that is lawful, reasonable and procedurally fair and the Promotion of Administrative Action Act 3 of 2000 (hereafter PAJA) was promulgated to give effect to this right. The objective of this article is to apply the right to just administrative action to the manner in which the decision in terms of section 164(3) of the TAA is taken. This is achieved by adopting an explanatory research approach and performing a literature review of the process in terms of section 164(3) of the TAA and the constitutional obligations in terms of section 33 of the Constitution as given effect to in PAJA. As the decision taken by the senior SARS official is influenced directly by the right to just administrative action, it should be taken in a lawful, reasonable and procedurally fair manner to ensure compliance with the Constitution and PAJA. For the decision to be taken in a lawful manner, the senior SARS official must at least be authorised to exercise the discretion in terms of the TAA and comply with the procedures and conditions stated in section 164(3) of the TAA. For the decision to be considered reasonable, the decision must be, at the minimum, rational and proportional, and to ensure that the decision is taken procedurally fair, SARS should comply with at least the relevant compulsory elements in terms of section 3(2)(b) of PAJA. A decision in terms of section 164(3) of the TAA which fails to meet the requirements of lawfulness, reasonableness and/or procedural fairness will be subject to review on several grounds listed in section 6(2) of PAJA. KeywordsSection 164(3) of the Tax Administration Act; suspension of payment of tax pending objection and appeal; discretion; administrative action; section 33 of the Constitution; Promotion of Administrative Justice Act.……………………………………………………….
Section 164(3) of the Tax Administration Act No. 28 of 2011 gives a senior SARS official the discretion to suspend the payment of disputed tax or a portion thereof, having regard to relevant factors. Limited guidance is available in this regard. The objectives are to establish the concerns and uncertainties regarding the relevant factors and to determine whether a ‘suspension of the payment of disputed tax’ in terms of section 164(3) constitutes the granting of ‘credit’ in terms of a ‘credit agreement’ in terms of the National Credit Act, Act No. 34 of 2005. This is achieved by adopting an explanatory research approach and performing a literature review and comparative analysis respectively. The conclusion is reached that the current factors listed are not necessarily the most relevant ones. Recommendations are made to simplify the process and to revise and improve the wording regarding the relevant factors.
Background: Disposing of a residential property by way of a lottery sounds peculiar, but a number of these transactions relating to residential properties in South Africa have recently taken place. As this is not an ordinary way of disposing of and acquiring residential property, it is submitted that it is necessary to explore the tax consequences resulting from such a transaction. Aim: The objective of this article is to explore some of the most pertinent South African tax consequences of such a residential property lottery transaction, from the viewpoint of the owner (‘seller’) who disposes of the residential property and the winner (‘purchaser’) who acquires the residential property in terms of the lottery. Setting: This article examines existing literature in a South African income tax environment to explore the tax consequences resulting from a disposal and acquisition of residential property by way of a lottery. Methods: A non-empirical study, which entails the study of the various South African tax provisions and an application thereof to the facts of the lottery transaction, was conducted. A doctrinal research approach was followed within the realm of exploratory research. Results: Disposing of and acquiring residential property by way of a lottery results in a number of actual tax consequences, as well as a number of uncertainties regarding taxes (referred to as uncertain considerations). Conclusion: The conclusion is reached that the possible tax consequences of such a transaction can create tax risks or can result in unintended tax consequences relating to inter alia income tax (including capital gains tax), transfer duty and donations tax. The insights provided in this article do not always result in conclusive answers but they may, however, result in further research to be conducted, and a number of such areas for further research were identified. Should residential property lottery transactions occur more frequently in South Africa in future, it is recommended that the South African Revenue Services (SARS) issues clear guidance on the tax treatment from the perspective of the owner and the winner of such a transaction to ensure that any uncertainties are dealt with correctly.
Orientation: Financial behaviour is known for the direct or indirect management of funds through inter alia spending, saving and borrowing.Research purpose: This study aimed to investigate the financial behaviour of qualified financial professionals and how it compares with behaviour since the national lockdown regulations in South Africa were imposed in March 2020.Motivation for the study: Several studies found that higher levels of financial knowledge are often associated with more desirable financial behaviour, but because of individual psychological resource differences, people in a similar economic situation may experience different levels of financial threat.Research approach/design and method: An empirical study using a survey, which is supported by an underlying literature review.Main findings: Survey results showed that most respondents do not track actual expenditure against budgets; however, this tendency changes with an increase in age. Financing through loans decreases with an increase in the age of respondents. Cash flow considerations were identified since the national lockdown regulations were imposed, addressed mostly by an increase in saving initiatives. Where qualified financial professionals use financial advisors, it is predominantly for advising on retirement and investment strategies. An association was found between the age of respondents and the likelihood of utilising the services of financial advisors for taxation savings.Practical/managerial implications: It is recommended that the findings on how qualified financial professionals managed their funds prior to and after the national lockdown should be used as guidance by others.Contribution/value-add: The study provides information that the lockdown did not necessarily result in major changes in the financial behaviour of the qualified financial professionals in the study.
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