Advanced Litigation Strategies in Transfer Pricing Prof D N Erasmus Prof A Venter

Content IntroductionBackground Tax Administration Process - BEFORE the Audit - BEFORE the Audit - DURING the Audit - DURING the Audit - AFTER the Audit - AFTER the AuditLitigation

Background REASON for the seminar PURPOSE of the seminar

BACKGROUND: REASON for the Seminar 16 Feb July April July 2013 RECENT PUBLICATIONS

Tax Admin Process BEFORE the Audit DURING the Audit DURING the Audit AFTER the Audit AFTER the AuditLITIGATION

Level of detail & sophistication to be pursued (p6) Q?s to be answered in a TP Risk Assessment Process (p8) Risk Factors (p11) Evaluating TP risk (p13) Risk Assessment Process (p30) Sharing risk assessments with taxpayers (p33 par. 147) Level of detail & sophistication to be pursued (p6) Q?s to be answered in a TP Risk Assessment Process (p8) Risk Factors (p11) Evaluating TP risk (p13) Risk Assessment Process (p30) Sharing risk assessments with taxpayers (p33 par. 147) BEFORE the Audit: Key IndicatorsKey Indicators BEFORE the Audit: Key IndicatorsKey Indicators

Refer to the documentation WHITE PAPER pages 23 – 25 Refer to the documentation WHITE PAPER pages 23 – 25WHITE PAPER WHITE PAPER Discharging the onus of proof Discharging the onus of proof Efficient & Effective use resources Efficient & Effective use resources The Constitution s 232 and soft law The Constitution s 232 and soft law The Constitution ss 1(c), 2 and 195 The Constitution ss 1(c), 2 and 195 Shuttleworth case para’s [44]and [46] Shuttleworth case para’s [44]and [46][44]and [46[44]and [46 SARS Act s 4(2) SARS Act s 4(2) Refer to the documentation WHITE PAPER pages 23 – 25 Refer to the documentation WHITE PAPER pages 23 – 25WHITE PAPER WHITE PAPER Discharging the onus of proof Discharging the onus of proof Efficient & Effective use resources Efficient & Effective use resources The Constitution s 232 and soft law The Constitution s 232 and soft law The Constitution ss 1(c), 2 and 195 The Constitution ss 1(c), 2 and 195 Shuttleworth case para’s [44]and [46] Shuttleworth case para’s [44]and [46][44]and [46[44]and [46 SARS Act s 4(2) SARS Act s 4(2) BEFORE the Audit: Documentation Requirements

Ensuring compliance with the TAA sections on the status of the audit, and the letter of findings at the conclusion of the audit… Relevant material Relevant material s 3(2) of TAA s 3(2) of TAA s 41 of TAA s 41 of TAA s 42 of TAA s 42 of TAA s 46 of TAA s 46 of TAA s 102 of TAA – onus of proof s 102 of TAA – onus of proof s 105 – court forum s 105 – court forum Ensuring compliance with the TAA sections on the status of the audit, and the letter of findings at the conclusion of the audit… Relevant material Relevant material s 3(2) of TAA s 3(2) of TAA s 41 of TAA s 41 of TAA s 42 of TAA s 42 of TAA s 46 of TAA s 46 of TAA s 102 of TAA – onus of proof s 102 of TAA – onus of proof s 105 – court forum s 105 – court forum DURING the Audit

Refer to the suggested Audit Engagement Letter Refer to the suggested Audit Engagement Letter Refer to the suggested Audit Engagement Letter Refer to the suggested Audit Engagement Letter BEFORE the Audit: Audit Engagement Letter

Ensure a comprehensive response to the letter of findings Ensure a comprehensive response to the letter of findings Ensure an objective review by SARS Ensure an objective review by SARS Promotion of Administrative Justice Act Promotion of Administrative Justice Act Promotion of Administrative Justice Act Promotion of Administrative Justice Act Consider any Review Application to the High Court for procedural defects Consider any Review Application to the High Court for procedural defects Invoke the MAP process Invoke the MAP process Draft a comprehensive request for reasons Draft a comprehensive request for reasons Draft a comprehensive Letter of Objection Draft a comprehensive Letter of Objection Other issues Other issues Ensure a comprehensive response to the letter of findings Ensure a comprehensive response to the letter of findings Ensure an objective review by SARS Ensure an objective review by SARS Promotion of Administrative Justice Act Promotion of Administrative Justice Act Promotion of Administrative Justice Act Promotion of Administrative Justice Act Consider any Review Application to the High Court for procedural defects Consider any Review Application to the High Court for procedural defects Invoke the MAP process Invoke the MAP process Draft a comprehensive request for reasons Draft a comprehensive request for reasons Draft a comprehensive Letter of Objection Draft a comprehensive Letter of Objection Other issues Other issues AFTER the Audit

Costs of proceeding directly to litigation Costs of proceeding directly to litigation Guarding against the potential Loss of Evidence Guarding against the potential Loss of Evidence Guarding against the potential Loss of Evidence Guarding against the potential Loss of Evidence Potential for settlement Potential for settlement Potential for settlement Potential for settlement Onus of proof Onus of proof Onus of proof Onus of proof Discovery regarding expert witnesses Discovery regarding expert witnesses Discovery regarding expert witnesses Discovery regarding expert witnesses Foreign Law in TP cases Foreign Law in TP cases Foreign Law in TP cases Foreign Law in TP cases Other issues Other issues Costs of proceeding directly to litigation Costs of proceeding directly to litigation Guarding against the potential Loss of Evidence Guarding against the potential Loss of Evidence Guarding against the potential Loss of Evidence Guarding against the potential Loss of Evidence Potential for settlement Potential for settlement Potential for settlement Potential for settlement Onus of proof Onus of proof Onus of proof Onus of proof Discovery regarding expert witnesses Discovery regarding expert witnesses Discovery regarding expert witnesses Discovery regarding expert witnesses Foreign Law in TP cases Foreign Law in TP cases Foreign Law in TP cases Foreign Law in TP cases Other issues Other issues Litigation

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