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Mpisane asked Sars for help

Nov 08 2012 18:47
Durban - Businessperson Shauwn Mpisane asked tax officials to help her make sure she was tax compliant, the Durban Regional Court heard on Thursday.

Mpisane told the court she asked the SA Revenue Service (Sars) to look into her cleaning company's books in 2008 because business had picked up and it was growing.

"I needed people with knowledge of how to run [the] books of Zikhulise," she said.

Mabongi Flora-Junior "Shauwn" Mpisane is accused of inflating invoices by more than R5m to cut her tax bill.

She is also accused of violating the Close Corporations Act by remaining the sole member of Zikhulise Cleaning, Maintenance and Transport CC when she had a previous fraud conviction. She has pleaded not guilty.

The court is holding a trial-within-a-trial to determine the admissibility of evidence submitted by the State.

It has submitted as evidence 148 invoices obtained from Mpisane during Sars's alternative dispute resolution (ADR) process.

Under Sars legislation, any information provided during this process is confidential.

Mpisane said she asked Sars for help after her husband Sbu, a metro police officer at the time, came under media scrutiny in 2008 because of his lifestyle. Sars had wanted to audit him.

Mpisane said she had asked Sars to check whether she was tax compliant for the period 2003 to 2007, because the 2008 financial results were not ready.

She said Sars had recommended some auditing companies, but that the auditing firm SAB&T was available.

It recommended that she got an in-house auditor, as her company was growing. An accountant who had just completed his articles was assigned to audit Mpisane's company.

Mpisane criticised Sars for using information she had volunteered in 2003 to prosecute her. Sars officials handed the matter to the National Prosecuting Authority.

Mpisane was convicted on 62 counts of fraud in 2004. Mpisane said when Waheeda Osman, a Sars auditor in Durban audited a draft statement she had submitted in 2008, she was puzzled and that her conduct was questionable.

Osman raised taxable profits of about 61 percent for the financial year of 2008 which was unreasonable, Mpisane said.

Mpisane told the court that her financial manager Kishal Reddy was incompetent.

Earlier, the court heard that Mpisane's application with the Sars Voluntary Disclosure Programme (VDP) was rejected.

Mpisane applied for voluntary disclosure in July 2011 and it was rejected by February 2012.

Her application was submitted after she was charged with fraud and corruption.

According to Sars group executive of the legal and policy division, Johan Vlok Symington, the programme allowed for an entity or a person to enter into a process where a taxpayer disclosed information to Sars and provided a tax payer an opportunity to resolve any outstanding affairs.

Symington said the information remained confidential and could not be accessed by any other units within Sars.

Mpisane's application was unsuccessful because of investigations of VAT defaults that had been instituted against her, he said.

Defence advocate Jimmy Howse said Sars dealt with Mpisane's application unfairly, because the findings on her application stated it was rejected because of the investigations.

Howse said some acts of the VDP were not considered when the findings were made.

He said the Sars official who dealt with Mpisane's application did not apply her mind when she made the decision.

The trial continues on Friday.
sars  |  shauwn mpisane



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