In the case between Appellant and the commissioner for the South African Revenue Service.Heard on 22 March 2007 in Bloemfontein.
terms of section 83(1) of the Income Tax Act 58 of 1962, the appellant
appealed against the assessments of the respondent for two tax years.
appellant was a lawyer who practised in South Africa and Lesotho.He
was a partner in a firm in Lesotho, and the respondent had included
profits earned in that partnership in the two relevant tax years.The
appellant objected as those profits were taxed in Lesotho.He contended
that his share of the profits of the partnership was taxable only in
Lesotho and exempted from tax in South Africa.
the matter was governed by the "Agreement between the Government of the
Republic of South Africa and the Government of the Kingdom of Lesotho
for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with respect to Taxes on Income".As the appellant was a
resident of South Africa, his involvement in the partnership was an
enterprise of South Africa that carried on business in another
contracting State (Lesotho) through a permanent establishment therein.Thus, in terms of article 7 of the Agreement, the profits of the
enterprise so carried on by the appellant might be taxed in Lesotho, but
taxes so paid should be deducted from taxes due by the appellant in
South Africa as was done by the Commissioner.The appeal was therefore
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.