Understatement Penalties in South Africa

This judgment underscores the procedural limits in tax litigation, clarifying that taxpayers may not introduce entirely new grounds of appeal that effectively constitute new objections to previously undisputed aspects of an assessment. It reinforces the principles of finality, fairness, and procedural integrity in the objection and appeal process under the Tax Administration Act.

Explore the key changes in SARS’ VDP Guide Issue 2, including eligibility, audit timing, voluntariness, penalties, cross-tax disclosure risks, rejection decisions and the finality of VDP agreements.

In this practical training session, we unpack Tax Court judgment IT 24852 (Taxpayer EPP v SARS), where a taxpayer sought to deduct R38.8 million after customs and excise refund claims became time-barred. Explore the critical distinction between expenditure and loss under section 11(a), the timing of deductions, the impact of prescribed refund claims, understatement penalties, interest, and potential post-judgment remedies through reduced assessments and prescription exceptions under the Tax Administration Act

A comprehensive analysis of Absa and Another v CSARS, examining SARS’s application of the General Anti-Avoidance Rules (GAAR) to complex preference share funding structures.

A practical training session on how section 210 now applies to trusts, what Notice 7314 actually does, why 4 May 2026 is not a universal cliff-edge, and how trustees should regularise carefully without panic-filing.

“A significant High Court ruling on SARS discretion under the ‘pay now, argue later’ rule, highlighting the importance of rational decision-making, adequate security, and procedural fairness in tax disputes.”