ARTICLE · 09 FEBRUARY 2012

Pay Now And Argue Later

Bell Dewar

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In terms of the ‘pay now and argue later principle’ taxpayers are obliged to pay the South African Revenue Service any taxes due; albeit any pending court decisions or objections against any assessments.

South AfricaTax

Conor McFadden

In terms of the 'pay now and argue later principle' taxpayers are obliged to pay the South African Revenue Service any taxes due; albeit any pending court decisions or objections against any assessments.

This principle has been challenged on constitutional grounds but the Constitutional Court in Metcash Trading Ltd v C: SARS affirmed its validity. The Constitutional Court held that the pay now and argue later rule is not unfair and its limitations are justifiable in terms of section 36 of the Constitution. In other words, not paying the full

Pursuant to the Metcash Trading judgement in the year 2000, sections 13(1) and 38(1) of the Taxation Laws Second Amendment Act of 2009 substituted section 88 of the Income Tax Act and section 36 of the Value Added Tax Act respectively. The Minister of Finance announced that both sections would come into operation on 1 February 2011.

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