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News & Press: SARS operational & eFiling questions

Clarity on a corporate income tax audit

Friday, 14 November 2014   (0 Comments)
Posted by: Author: SAIT Technical
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Author: SAIT Technical

Q: What does a CIT assurance audit entail? How long does it take? How do you get selected?

A: The acronym CIT refers to corporate income tax and is a term used by SARS and we assume that the term "CIT assurance audit” refers to an audit by SARS.  The relevant law in this regard is found in Part A and B of Chapter 5 of the Tax Administration Act.  We believe that section 40 is relevant to the issues raised by you.  

SARS refuses to give any indication of how they select a taxpayer for an audit, but section 40 reads as follows: 

"SARS may select a person for inspection, verification or audit on the basis of any consideration relevant for the proper administration of a tax Act, including on a random or a risk assessment basis.”  The process starts when a senior SARS official grants a SARS official written authorisation to conduct a field audit as referred to in Part B – section 40

A SARS official named in an authorisation may require a person, with prior notice of at least 10 business days, to make available at the person's premises specified in the notice relevant material that the official may require to audit in connection with the administration of a tax Act in relation to the person or another person – section 48.  This notice must indicate the initial basis and scope of the audit.  

The Act gives no indication of how long such an audit will take, but provides that the SARS official involved in or responsible for an audit must, in the form and in the manner as may be prescribed by the Commissioner by public notice, provide the taxpayer with a report indicating the stage of completion of the audit.  This must be done every 90 days.  

Disclaimer: Nothing in this query and answer should be construed as constituting tax advice or a tax opinion. An expert should be consulted for advice based on the facts and circumstances of each transaction/case. Even though great care has been taken to ensure the accuracy of the answer, SAIT do not accept any responsibility for consequences of decisions taken based on this query and answer. It remains your own responsibility to consult the relevant primary resources when taking a decision.



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.

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