The South African Revenue Service (SARS) has secured a High Court victory
The South African Revenue Service (SARS) has secured a High Court victory after the Western Cape High Court ruled that a R10 million tax deduction claimed by Meiring Citrus (Pty) Ltd was not allowed.
According to Richan Schwellnus, Team Lead: Tax Controversy & International Tax, and Charlotte McLaren, Tax Associate: Tax Controversy & Dispute Resolution at Tax Consulting South Africa, the dispute stems from a R10 million deduction that Meiring Citrus claimed in its 2017 tax return after entering into what it considered to be an insurance arrangement with Santam.
The arrangement involved Meiring Citrus paying R10 million to Santam, which provided an additional R2.4 million in cover.
Santam deducted an underwriting fee of R400,000, while the remaining R9.6 million was placed into an experience account linked to Meiring Citrus.
