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Income Tax Act, 1962 (Act 58 of 1962)

Regulations issued under Section 91A of the Income Tax Act, 1962

Part 5: Compromise of tax debt

11. Consideration of request to compromise tax debt



1) In considering a request for a compromise, the Commissioner must have regard to the extent that the compromise may result in-
a) savings in the costs of collection;
b) collection at an earlier date than would otherwise be the case without the compromise;
c) collection of a greater sum than would otherwise have been recovered; and
d) the abandonment by the debtor of some claim or right, that has a monetary value, arising under any Act administered by the Commissioner, including any right to carry forward any assessed loss or assessed capital loss.


2) In determining the position without the compromise, the Commissioner must have regard to-
a) the value of the debtor's present assets;
b) future prospects of the debtor, including any arrangements which have been implemented or are proposed which may have the effect of diverting income or assets that may otherwise accrue to or be acquired by the debtor or any connected person in relation to the debtor;
c) past transactions of the debtor; and
d) the position of any connected person in relation to the debtor.