SARS Goes Global Investigating Your Tax Affairs
SARS has extended its ability to query, interrogate and find out about our tax matters. What isn't so well known is that these powers are rapidly extending across the globe.
South Africa has signed multilateral and bilateral taxation agreements with over 60 nations (and counting). This is part of a global trend as countries seek to maximise the tax revenues due to them by fighting tax evasion and avoidance across international borders.
What can SARS do?
In South Africa, SARS can gather information from taxpayers to ensure compliance. It can also obtain information from third parties. It can compel third parties who owe a taxpayer (or who hold assets for a taxpayer) to pay SARS for tax liabilities unpaid by the taxpayer. SARS can aggressively pursue legal avenues to recover tax liabilities.
By signing the multilateral and bilateral agreements, SARS is seeking to be able to operate globally as it does within South Africa’s borders. These agreements thus include for example –
Two recent court cases illustrate this –
What can SARS do?
In South Africa, SARS can gather information from taxpayers to ensure compliance. It can also obtain information from third parties. It can compel third parties who owe a taxpayer (or who hold assets for a taxpayer) to pay SARS for tax liabilities unpaid by the taxpayer. SARS can aggressively pursue legal avenues to recover tax liabilities.
By signing the multilateral and bilateral agreements, SARS is seeking to be able to operate globally as it does within South Africa’s borders. These agreements thus include for example –
- Routine exchange of information on taxpayers,
- Examining taxpayer affairs in these foreign countries,
- Freezing of taxpayer assets in these countries and
- Getting the assistance of foreign courts to collect tax debts owed to SARS.
Two recent court cases illustrate this –
- South African courts recently froze South African assets of an Australian taxpayer who owed Australian tax authorities R235 million.
- An English court gave English tax authorities permission to collect tax debts owed in South Africa.
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