Requests for Relevant Material

 2018-09-14 04:05 PM by

After carefully determining your company tax liability and submitting the completed company tax return, SARS will acknowledge the receipt of your return. SARS might then proceed and request relevant supporting material in instances where it is deemed necessary.

In our experience, SARS sometimes does not specify the number of days afforded to the taxpayer to comply with the request, and if the number of days is specified, it is unclear whether SARS is referring to calendar days or business days.

Sound familiar?

 

What is a request for relevant material?

SARS may request a taxpayer to submit relevant material within a reasonable period if SARS deems it necessary. Relevant material includes any document or evidence that is in the opinion of SARS foreseeably relevant to the matter under consideration. A letter to request such material must specify the specific relevant material requested as well as the timeline allowed for submission to SARS.

The conundrum

SARS is entitled to determine the period within which a taxpayer is required to submit the relevant material. This determination is usually done with reference to SARS’ internal policies and guidelines. Taking into consideration the volume and complexity of supporting documentation requested, the timeline for submission to SARS must be reasonable and fair.

It has come to our attention that the deadlines provided for submission of relevant material to SARS can sometimes be unclear and confusing. The request refers to days, and does not clearly state whether or not it is business days or calendar days. The definition of day is important as it could mean the difference between timeous submission and missing the submission deadline. It is therefore critical to clarify the submission deadline with SARS as soon as such a request is received.

Counting the days

The submission deadline is dependent on the term that is used in SARS’ request. If the request refers to:

  • Business day[s]: Saturdays, Sundays, and Public Holidays are Excluded.
  • Calendar day[s]: Saturdays, Sundays, and public holidays are Included.
  • Day[s]: Saturdays, Sundays, and Public Holidays are Excluded – This is our interpretation based on the Interpretation Act (1957), seeing as the term “day” is not a defined in either the Income Tax Act or the Tax administration Act.

Clarification of the submission deadline

If the wording of SARS’ request is unclear, i.e. reference is made to days without specifically stating whether it is Business days or Calendar days, we recommend that the submission period is confirmed by:

  • If the contact details of the SARS Auditor appear on the letter, phoning/sending an e-mail to the auditor.
  • If no contact details appear on the request, contacting the SARS contact centre at 0800 007 277. Always make sure to keep a record of the call reference number provided by SARS.

Remember to request the confirmation to be sent to you in writing.

What if the taxpayer needs more time to comply with the request?

Depending on the complexity and volume of relevant material required by SARS, the taxpayer may require additional time to comply with SARS’ request.

Should the taxpayer require an extension for submission, we recommend the following:

  • If the contact details of the auditor are available, contact the auditor directly via e-mail/telephone and request an extension.
  • Should the contact details of the auditor not be available, upload a request for extension letter on SARS e-Filing and also e-mail the same letter to the SARS central e-mail address. This letter should explicitly state the date until when extension is required. The letter should also include an e-mail address/contact number where the taxpayer can be reached.

It is extremely important to ensure extension is granted in writing and that the auditor involved in the matter is aware of the new extension deadline.

Remedies available

If the taxpayer is of the opinion that SARS has not acted within the confines of the law with respect to the request for relevant material process or any other related processes, the taxpayer can lodge a complaint with the SARS Complaints Management Office or the Office of the Tax Ombud. The most appropriate remedy would depend on the fact and circumstances of each case.

Even if a complaint is lodged, a taxpayer should also dispute any additional assessment raised by SARS by utilising the relevant SARS Dispute Resolution Channels within the timelines permitted.

 

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