Can I object to the director of an NOO if SARS is extending its inquiry beyond the reasons for the assessment?
Important:
This answer is based on tax law for the tax year ending 28 February 2020.
Answer:
We agree with you that, because an objection was made to the assessment (the additional one), SARS can only require a taxpayer to produce the additional substantiating documents necessary to decide the objection. This they should have done within 30 days after delivery of an objection – see rule 8. SARS is now requesting information unrelated to the objection.
It also appears that SARS cannot raise a new ground for the assessment or as a basis for disallowing the objection. New in the sense that it doesn’t relate to the grounds for the additional assessment.
This is an example of where SARS didn’t follow proper administrative process and one may well see the additional assessment as invalid.