Page 18 - Donation Tax & VAT class slides

INTRODUCTION & APPLICATION OF LEGISLATION

Interpretation rules

• Sometimes certain rules give SARS discretion in the way it should
apply certain provisions of the Income Tax Act.

• In order to deal with this confusion, the commissioner can issue

binding general rulings or interpretation notes (previously called
practice notes).

• Binding general rulings are issued by CSARS, at his or her

discretion, in respect of the application or interpretation of tax
law on a matter of general interest or importance. These rulings

are binding on SARS and on taxpayers.

• Interpretation notes are merely the opinion of SARS regarding the

interpretation and application of various legislative provisions and
do not form part of the Income Tax Act, and are also not binding

on SARS, except if they are a binding private or class ruling.

Therefore, a taxpayer can object to an assessment even if SARS
has assessed that taxpayer in terms of an interpretation note.

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