oa Meditari : Research Journal of the School of Accounting Sciences - The general meaning of "extenuating circumstances" for the purposes of section 76(2)(a) of the Income Tax Act

Volume 9, Issue 1
  • ISSN : 1022-2529



The additional tax (referred to as a "penalty" by the judiciary), which may be imposed in terms of section 76(1) of the Income Tax Act ("the Act") when a taxpayer is in default, can be very harsh (Up to 200% of the tax correctly chargeable). The Commissioner may remit any penalty imposed as he sees fit. However, when there was intent on the part of the taxpayer to evade the payment of tax, the Commissioner may not remit the 200% penalty, unless he is of the opinion that there are "extenuating circumstances".

This article examines the general meaning, as interpreted by the courts, of the "extenuating circumstances" that may be taken into account for the purposes of remission of penalties in terms of section 76(2)(a) of the Act.

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