Purveyors South Africa Mine Services (Pty) Ltd v Commissioner for the South African Revenue Services (135/2021) [2021] ZASCA 170; 2022 (3) SA 139 (SCA); 84 SATC 215 (7 December 2021)

Purveyors South Africa Mine Services (Pty) Ltd v Commissioner for the South African Revenue Services (135/2021) [2021] ZASCA 170; 2022 (3) SA 139 (SCA); 84 SATC 215 (7 December 2021)

The Supreme Court of Appeal held that Purveyors' voluntary disclosure application did not meet the requirements of section 227 of the Tax Administration Act. The application was not voluntary because it was prompted by SARS's compliance actions and warnings regarding penalties and interest. SARS had prior knowledge...

Source-derived case information.

Citation
[2021] ZASCA 170
Parties
Appellant: Purveyors South Africa Mine Services (Pty) Ltd; Respondent: Commissioner for the South African Revenue Services
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
7 December 2021
Case Number
135/2021
Procedural Posture
Civil Appeal / Appeal From the Tax Court of South Africa
Outcome
Appeal dismissed with costs, including the costs of two counsel.
Judges
Petse, Mathopo, Schippers, Mokgohloa, Molefe
Legal Topics
Voluntary Disclosure Programme, Tax Administration Act, Import Vat Liability, Penalties and Interest, Requirements for Valid Disclosure
Tax Law Civil Procedure Voluntary Disclosure Programme Tax Administration Act Import Vat Liability Penalties and Interest Requirements for Valid Disclosure

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Parties

Purveyors South Africa Mine Services (Pty) Ltd

Appellant

Commissioner for the South African Revenue Services

Respondent

Procedural Posture

Civil Appeal / Appeal From the Tax Court of South Africa

Legal Issues

  1. 1 Whether the taxpayer's voluntary disclosure application under section 227 of the Tax Administration Act was valid and voluntary.
  2. 2 Whether prior knowledge and prompting by SARS precluded the application from qualifying as voluntary.
  3. 3 Whether the requirements of section 227 were satisfied in the circumstances.

Ratio Decidendi

The Supreme Court of Appeal held that Purveyors' voluntary disclosure application did not meet the requirements of section 227 of the Tax Administration Act. The application was not voluntary because it was prompted by SARS's compliance actions and warnings regarding penalties and interest. SARS had prior knowledge of the taxpayer's default, and the application did not disclose any new information. The purpose of the Voluntary Disclosure Programme is to incentivise taxpayers to make a clean break by voluntarily disclosing defaults of which SARS is unaware, without prompting. Allowing relief where SARS is already aware of the default and has prompted the taxpayer would defeat the...

Court Disposition

Appeal dismissed with costs, including the costs of two counsel.

Orders

  • The appeal is dismissed with costs, including the costs of the two counsel.