oa Journal of Economic and Financial Sciences - A critical analysis of the current SARS model for the disclosure of reportable arrangements and a proposed alternative
|Article Title||A critical analysis of the current SARS model for the disclosure of reportable arrangements and a proposed alternative|
|© Publisher:||University of Johannesburg|
|Journal||Journal of Economic and Financial Sciences|
|Affiliations||1 University of Stellenbosch and 2 University of Cape Town|
|Publication Date||Oct 2012|
|Pages||391 - 415|
|Keyword(s)||Arrangement, Penalty, Reportable, SAICA, SARS, Tax Administration Bill and Tax benefit|
The reportable arrangements (RA) provisions are contained in sections 80M to 80T of the Income Tax Act. SARS issued a revised Draft Guide on 31 March 2010, which contains a model for the application of these provisions. However, due to numerous discrepancies and ambiguities contained in the Act and the guide, the interpretation of these provisions could be subjective and difficult to apply in practice. Failure to disclose a RA may result in a R1 million penalty. It is the purpose of this paper to develop an alternative, workable model to serve as a usable guide for taxpayers. This paper comprises a literature review and a study of empirical evidence obtained through a survey conducted among tax partners at a sample of 40 leading audit and legal firms. The majority of respondents considered the alternative model to be more accurate, user-friendly and helpful than SARS' model.
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