Businessman charged for tax fraud
Allegedly introduced himself as a tax consultant and practitioner from SARS
A businessman is appearing in the East London Regional Court for allegedly defrauding the South African Revenue Services of more than a million rand.
Lusindiso Mhlwatika is facing 290 counts of fraud, alternatively computer related fraud and 145 counts of fraudulent tax or tax evasion.
According to the indictment, Mhlwatika — who is a member of Magcwanini Trading and Projects CC — allegedly introduced himself as a tax consultant and practitioner from SARS.
“He gathered taxpayers registered on e-filing from East London, Cofimvaba, Engcobo, Elliot and Queenstown... He convinced them SARS owed them money but he must claim it from SARS on their behalf,” read a part of the indictment.
Mhlwatika allegedly obtained their IRP5 forms, their passwords and login names in order to gain access to their tax profiles.
It is the state’s case that Mhlwatika made false and fraudulent claims for specific income tax deductions. These included the taxpayers leaving South Africa, taxpayers incurring medical expenses out of their personal funds and that the taxpayers had disabilities during the assessment years 2008 to 2010 among other things.
It is said in the indictment that none of the taxpayers gave Mhlwatika permission to make the false claims to SARS.
He allegedly charged his victims between R400 and R1,100 for his services.
Totals of R761,920 and R658,330 were deposited into his personal accounts at Standard Bank and Absa Bank respectively and R13,460 was deposited into the business’ Standard Bank account.
Mhlwatika made a brief appearance before magistrate Deon Rossouw yesterday and the matter was rolled over to today where a trial date will be set.
According to the SARS website, the government body is in a process of finalising an African treaty that is expected to counteract fraud.
“Law advisers and officials from African Tax Administration Forum (ATAF) member states, including SARS, will seek to finalise a draft treaty on mutual assistance in tax matters which will then be signed by the relevant minsters of the ATAF member states.
“When adopted, the treaty will provide for the exchange of information in tax matters, the carrying out of tax examinations abroad, the carrying out of simultaneous tax examinations, and assisting in the collection of taxes,” the website says.
To report fraud call 0800 002 870.