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Tax Administration Act, 2011 (Act No. 28 of 2011)

Chapter 7 : Advance Rulings

80. Rejection of application for advance ruling

 

(1) SARS may reject an "application" for an "advance ruling" if the "application"—
(a) requests or requires the rendering of an opinion, conclusion or determination regarding—
(i) the market value of an asset;
(ii) the application or interpretation of the laws of a foreign country;
(iii) the pricing of goods or services supplied by or rendered to a connected person in relation to the "applicant" or a "class member";
(iv) the constitutionality of a tax Act;
(v) a "proposed transaction" that is hypothetical or not seriously contemplated;
(vi) a matter which can be resolved by SARS issuing a directive under the Fourth Schedule or the Seventh Schedule to the Income Tax Act;

[Section 80(1)(a)(vi) substituted by section 57 of the Tax Administration Laws Amendment Act, 2012 (Act No. 21 of 2012)]

(vii) whether a person is an independent contractor, labour broker or personal service provider; or
(viii) a matter which is submitted for academic purposes;
(b) contains—
(i) a frivolous or vexatious issue;
(ii) an alternative course of action by the "applicant" or a "class member" that is not seriously contemplated; or
(iii) an issue that is the same as or substantially similar to an issue that is—
(aa) currently before SARS in connection with an audit, investigation or other proceeding involving the "applicant" or a "class member" or a connected person in relation to the "applicant" or a "class member";
(bb) the subject of a policy document or draft legislation that has been published; or
(cc) subject to dispute resolution under Chapter 9;
(c) involves the application or interpretation of a general or specific anti-avoidance provision or doctrine;
(d) involves an issue—
(i) that is of a factual nature;
(ii) the resolution of which would depend upon assumptions to be made regarding a future event or other matters which cannot be reasonably determined at the time of the "application";
(iii) which would be more appropriately dealt with by the competent authorities of the parties to an agreement for the avoidance of double taxation;
(iv) in which the tax treatment of the "applicant" is dependent upon the tax treatment of another party to the "proposed transaction" who has not applied for a ruling;
(v) in respect of a "transaction" that is part of another "transaction" which has a bearing on the issue, the details of which have not been disclosed; or
(vi) which is the same as or substantially similar to an issue upon which the "applicant" has already received an unfavourable ruling;
(e) involves a matter the resolution of which would be unduly time-consuming or resource intensive; or
(f) requests SARS to rule on the substance of a "transaction" and disregard its form.

 

(2) The Commissioner may publish by public notice a list of additional considerations in respect of which the Commissioner may reject an "application".

 

(3) If SARS requests additional information in respect of an "application" and the "applicant" fails or refuses to provide the information, SARS may reject the "application" without a refund or rebate of any fees imposed under section 81.