A recent High Court judgment highlights the risks of leaving tax compliance entirely in someone else's hands — and the limits of SARS' power to refuse relief when things go wrong.

In TEG Asset & Risk Management CC v CSARS (8 October 2026), the Johannesburg High Court considered an unusual situation: a taxpayer discovered that its tax returns had been submitted by someone who had not been authorised by the taxpayer.

The dispute raised an important question. Can SARS refuse to consider reducing an assessment simply because the taxpayer had appointed someone else to manage its tax affairs?

The Court's answer was no — at least not without considering who actually submitted the returns.

How did things go wrong?

TEG had appointed an accountant, Mr Bowman, to manage its accounting and tax compliance obligations. Unbeknownst to TEG, Bowman subcontracted the submission of its tax returns to a tax consultant, Ms Buitendag, who controlled the taxpayer's eFiling access.

Following an audit, SARS raised assessments relating to TEG's 2017 income tax year and various VAT periods between 2015 and 2017.

TEG maintained that the assessments were incorrect and that its returns had been fraudulently submitted by someone without its authority.

It consequently requested reduced assessments under section 93(1)(e)(iii) of the Tax Administration Act (TA Act).

SARS refused, reasoning that Bowman was TEG's duly appointed public officer and therefore authorised to act on its behalf.

But there was a problem with SARS' reasoning: Bowman was not the person who had submitted the returns.

What did the Court decide?

Section 93(1)(e)(iii) permits SARS to issue a reduced assessment where a senior SARS official is satisfied that the assessment was based on a return fraudulently submitted by someone not authorised by the taxpayer.

The Court identified two requirements:

1. The return itself must have been fraudulent.
2. It must have been submitted by someone who was not authorised by the taxpayer to submit returns.

Importantly, the mere fact that an unauthorised person submitted a return does not automatically make that return fraudulent.

The Court found that SARS had failed to address the critical allegation that Buitendag, rather than Bowman, had submitted the returns without TEG's authority. SARS had not disputed that allegation in its court papers.

SARS' decision was therefore based on an incorrect factual premise.

The Court set aside SARS' decisions and referred the matter back for reconsideration, with SARS ordered to pay costs.

TEG won the review, but not yet the tax dispute

Whether the returns were fraudulent and whether reduced assessments should ultimately be issued remain questions for SARS to determine.

What should businesses take from this?

The judgment carries an important warning for taxpayers who entrust their tax affairs to accountants, tax practitioners or other intermediaries.

Outsourcing tax compliance does not mean outsourcing responsibility.

Businesses should know who has access to their eFiling profiles, who actually submits their returns and whether those individuals have been properly authorised. Regular oversight of submissions and SARS correspondence is equally important.

The lesson for taxpayers seeking relief from SARS is to present the relevant facts and supporting evidence clearly from the outset. The Court itself observed that the significance of the unauthorised submissions only became clear during the review proceedings.

For SARS, the message is equally straightforward. An administrative decision must be based on the relevant facts, not assumptions about what those facts might be.

The bottom line?

Taxpayers remain responsible for their tax affairs, but SARS must still get the facts right before making decisions.