LML4804 OCTOBER
NOVEMBER PORTFOLIO
(COMPLETE ANSWERS)
Semester 2 2024 - DUE 25
October 2024
m
, LML4804 OCTOBER NOVEMBER PORTFOLIO
(COMPLETE ANSWERS) Semester 2 2024 - DUE 25
October 2024
QUESTION 1 (TAX ADMINISTRATION AND TAX AVOIDANCE)
The Tax Administration Act 28 of 2011 (TAA) empowers the
Commissioner for the South African Revenue Service (the
Commissioner) to conduct audits on taxpayers. The
Commissioner has, over the years, announced that the South
African Revenue Service (SARS) will conduct audits on all
taxpayers that enjoy a certain lifestyle. Most recently, the
Commissioner announced that taxpayers who buy certain
premium-brand goods would be subjected to audits. In doing so,
SARS is upholding its commitment to keep a close eye on the so-
called High-Net-Worth (HNW) taxpayers. A HNW taxpayer is
defined as a person whose estate is worth more than R50 million.
Following the above statement, SARS announces in the press
that it will be conducting lifestyle questionnaires on all wealthy
taxpayers who are members of the Vintage Club. The Vintage
Club receives a notice from SARS demanding information about
the names and personal details of its members. WHAT IS
REQUIRED OF YOU: The club approaches you for advice
regarding SARS’ notice. Advise the club in terms of the existing
law. [15] SUB-TOTAL FOR QUESTION 1 [15 marks]
Advice to the Vintage Club Regarding SARS’ Notice
The South African Revenue Service (SARS) is empowered by the Tax Administration Act 28
of 2011 (TAA) to conduct audits and request relevant information to ensure tax compliance.
However, SARS' powers are not unlimited and must comply with constitutional principles,
particularly the rights to privacy and just administrative action. Below is a legal analysis of
SARS’s demand for the personal details of the club’s members.
1. SARS' Powers to Request Information
The TAA grants SARS wide powers to obtain information to detect tax avoidance or non-
compliance. Specifically:
NOVEMBER PORTFOLIO
(COMPLETE ANSWERS)
Semester 2 2024 - DUE 25
October 2024
m
, LML4804 OCTOBER NOVEMBER PORTFOLIO
(COMPLETE ANSWERS) Semester 2 2024 - DUE 25
October 2024
QUESTION 1 (TAX ADMINISTRATION AND TAX AVOIDANCE)
The Tax Administration Act 28 of 2011 (TAA) empowers the
Commissioner for the South African Revenue Service (the
Commissioner) to conduct audits on taxpayers. The
Commissioner has, over the years, announced that the South
African Revenue Service (SARS) will conduct audits on all
taxpayers that enjoy a certain lifestyle. Most recently, the
Commissioner announced that taxpayers who buy certain
premium-brand goods would be subjected to audits. In doing so,
SARS is upholding its commitment to keep a close eye on the so-
called High-Net-Worth (HNW) taxpayers. A HNW taxpayer is
defined as a person whose estate is worth more than R50 million.
Following the above statement, SARS announces in the press
that it will be conducting lifestyle questionnaires on all wealthy
taxpayers who are members of the Vintage Club. The Vintage
Club receives a notice from SARS demanding information about
the names and personal details of its members. WHAT IS
REQUIRED OF YOU: The club approaches you for advice
regarding SARS’ notice. Advise the club in terms of the existing
law. [15] SUB-TOTAL FOR QUESTION 1 [15 marks]
Advice to the Vintage Club Regarding SARS’ Notice
The South African Revenue Service (SARS) is empowered by the Tax Administration Act 28
of 2011 (TAA) to conduct audits and request relevant information to ensure tax compliance.
However, SARS' powers are not unlimited and must comply with constitutional principles,
particularly the rights to privacy and just administrative action. Below is a legal analysis of
SARS’s demand for the personal details of the club’s members.
1. SARS' Powers to Request Information
The TAA grants SARS wide powers to obtain information to detect tax avoidance or non-
compliance. Specifically:
