SARS Has Launched An Income Tax Audit Missile At Busisiwe Mkhwebane

SARS Has Launched An Income Tax Audit Missile At Busisiwe Mkhwebane

January 27, 2020 0 By Kailee Schamberger


The South African Revenue Service, Sars, has
launched an investigation into the income tax affairs of Public Protector, Busisiwe
Mkhwebane, dating back to 2011. Sars has ordered her to hand over copies of
all relevant materials including financial information, employment income, foreign income,
business income, expenses, deductions, and other income. Mkhwebane’s spokesperson, Oupa Segalwe,
on Saturday 25 January 2020, said the public protector believed Sars’s move was an indication,
that she was being “lynched”, as part of “concerted efforts to instil fear in
her, following some investigations of hers”. He added, that Mkhwebane had refused to give
the Hawks a statement, because they are “abusing resources on frivolous cases”. This comes just over a month, after the Hawks
moved on Mkhwebane, requesting a warning statement related to a case of alleged perjury, and
defeating the ends of justice, laid against her by advocate Paul Hoffman in August 2019. Hoffman, of Accountability Now, had laid criminal
charges against Mkhwebane, after the Constitutional Court upheld an order, for her to pay costs
from her own means. The Constitutional Court had found Mkhwebane
acted in bad faith, during her probe into the apartheid-era loan to Bankorp, now part
of Absa, by the South African Reserve Bank. Hoffman had also asked the Legal Practice
Council, to consider striking her from the roll of advocates. Pressure on Mkhwebane was added this week,
when Speaker of Parliament, Thandi Modise, approved a motion to initiate proceedings
for her removal. In a letter co-signed by the executive for
investigative audits, Charles Makola, and senior manager for investigative audits, Matimba
Macebele, Sars demanded bank statements for all local and foreign accounts. In addition, the revenue collector demanded
copies of a statement of assets and liabilities, a fixed assets register, a detailed breakdown
of vested shares and incentive scheme, and copies of short and long-term insurance contracts,
among others, within 21 days. Parts of the letter reads as follows. “You are required to provide copies of the
relevant material indicated below in relation to the tax periods under audit within 21 business
days, from the date of this letter. Please retain the originals for your records”. “A field audit may be conducted at your
premises, and Sars will notify you accordingly. Electronically stored data can be submitted
by arrangement with the Sars official.” Sars ordered Mkhwebane to surrender copies
of payslips, employment contracts, IRP5 certificates, and investment income certificates for the
period under audit. She was also instructed to provide copies
of the following. Employment contract on which foreign income
was received. Passport(s). Schedule of days outside South Africa in respect
of foreign income. Gambling income, including horseracing. Detailed financial statements, and all supporting
calculations for trade profits and loss, including farming. Rental contracts. Indications if any event occurred during the
tax period mentioned above, which could constitute a disposal such as transfer, donation, or
loss of asset. Sale agreement or invoice, to confirm the
proceeds for all assets disposed of. Pension fund, and retirement annuity contributions
certificate. Bond statements in respect of property rented
out. Detailed travel log book, indicating the business,
and private travel, including the opening and closing odometer readings. Copies of invoices for repairs and maintenance
on motor vehicles. Schedule of medical expenses not recovered
from the medical aid scheme, with supporting invoices and proof of payment. Detailed calculation of all expenses claimed. Detailed breakdown of travel expenses claimed,
and detailed calculation of home office expenses claimed, including the size of the home office
in relation to the size of the building. Sars reminded Mkhwebane it could “request
relevant material from any person who maintains, or keeps such material” in respect of the
taxpayer, including financial institutions and insurance companies, in terms of Section
46 of the Tax Administration Act number 28 of 2011. A warning in the letter states as follows. “It is a criminal offence to wilfully, and
without just cause, fail to provide the relevant material”. Please check in the description box below,
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