An analysis of the anti-avoidance provision section 103 of the South African Income Tax Act 58 of 1962

Abstract :

Determines whether the courts succeed in construing Section 103, so as to assist the Commissioner to arrive at a correct assessment. Before depicting the achievements of the tax payer against those of revenue, the study notes the difference between tax avoidance and tax evasion. This distinction seems to have no effect on the court’s interpretation. It is submitted that invoking the provisions of section 103 does not mean that when one is caught in tax avoidance one escapes the sword of the law. Proper assessment by the revenue after invoking of provisions of section 103 amounts to a penalty on the part of the taxpayer. The taxpayer’s victory against the Commissioners in issues involving the anti tax avoidance measure is shown in certain case studies. However the impact of the these cases was neutralised by the legislature. In practice, taxpayers have been relatively successful in defeating the Commissioner in contests based on the application of section 103(2). In some cases the taxpayers were able to satisfy the Court that they were moved by non-tax considerations to take over the company with the assessed loss. On the other hand, certain cases prove how the courts succeeded in construing section 103 to the advantage of the Commissioner. It is concluded that a taxpayer can structure a transaction, operation or scheme which has the effect of avoiding tax, with a reasonable prospect of success.



Author Mponco NP
Date Accessioned 2016-09-22T09:18:07Z
Date Available 2016-09-22T09:18:07Z
Date Created 1995
Identifier URL 1996
Language English
Subject Law
Subject 2 Law
Alternative Title
Degree Type Masters degree
Degree Description  LL M