The Court did not rule on the correct interpretation of Section 205, as it referred the case to trial. However, the Court put forward arguments on sarS Antarctica that the SARS argument does not make sense, as it means that any form of non-compliance with a compromise agreement, no matter how important, would lead to a breach of the compromise agreement. Our multidisciplinary team of tax lawyers and accountants has a proven track worth in negotiations with SARS and has helped many companies successfully seek a compromise agreement. We guarantee you a legal privilege and we take a strict legal and compliant approach with a thought based on solutions. If you need help checking to see if you can use the compromise route to provide financial facilities, call your local Moore Stephen office. It is important to note that SARS is not bound by a compromise agreement signed between the parties if the objective of a compromise is to achieve the highest return on debt collection when a payer is unable to pay the full amount, taking into account good management of the tax system and administrative efficiency. An application for compromise must be made by the taxpayer or by a registered tax practitioner acting on behalf of the taxpayer. In order for SARS to consider a compromise, it is necessary to provide detailed financial information on the taxpayer`s affairs. It will be interesting to see what the court will say if the case is tried and both parties have evidence and arguments. The result, regardless of the outcome, will determine the interpretation of the word „essential“ in relation to the provisions of section 205 of the Act – is any misrepresentation or non-disclosure essential and therefore permits the declaration of the compromise agreement, or does it depend on the circumstances of the case and the extent of the misrepresentation or non-disclosure? Malema argued that the donor`s identity for SARS did not matter within the meaning of the compromise agreement and argued that he had forgotten the property (although interest in the property was mentioned in Malema`s First Compromise Amendment).

A compromise cannot be considered if the taxpayer challenges the debt. Therefore, as long as a case is challenged or challenged, a compromise cannot be contemplated. If the taxpayer wants to compromise, he must withdraw his appeal or complaint. In addition, the Court noted that the word „essential,“ if interpreted correctly in Section 205, suggests that the misrepresentation or omission of SARS must lead, to a large extent, to the conclusion or rejection of a compromise agreement. The Court found that the information provided prompted either sarS to forego a debt or to enforce it, and it was only when the information provided was substantially inaccurate or incomplete that SARS would have to forego a debt if it had not been the case if the information provided had been materially different.