SARS v Mkhize: Court Authorises Sale of Preserved Properties for Tax Debts

In South Africa, the High Court of KwaZulu-Natal, Durban, on 26 October 2026, authorised the sale of preserved properties under section 163 of the Tax Administration Act (TAA) in the matter of *Commissioner for South African Revenue Service v Mkhize and Others*, to protect their value pending a final action to determine their executability for tax debts.

This ruling is highly significant for tax practitioners and individuals facing tax debt, as it clarifies the South African Revenue Service (SARS)'s powers to preserve and realise assets even before a final determination of tax liability or executability. It underscores SARS's aggressive stance in recovering tax debts and its willingness to use statutory powers to prevent the dissipation or depreciation of assets that may ultimately be used to satisfy those debts. This has direct implications for asset protection strategies and the urgency with which taxpayers must address SARS demands.

The core legal framework here is the Tax Administration Act 28 of 2011 (TAA), specifically section 163, which grants SARS the power to apply for an order preserving assets. This provision is crucial for SARS to prevent taxpayers from disposing of assets while tax assessments or recovery processes are ongoing. The High Court, as part of the South African court hierarchy, has the jurisdiction to grant such orders. The reference to "executability for tax debts" points to the broader enforcement mechanisms available to SARS under the TAA, including the ability to obtain civil judgments for outstanding tax and execute against a taxpayer's property. The case citation indicates this is a decision from the KwaZulu-Natal Division of the High Court.

The key parties involved are the Commissioner for the South African Revenue Service (SARS) as the applicant, and Mkhize and Others as the respondents. The High Court of South Africa, KwaZulu-Natal, Durban, is the judicial body that issued the order.

Attorneys advising clients with significant tax liabilities or those under SARS investigation must be acutely aware of SARS's powers under section 163 of the TAA. This case highlights the need for immediate and proactive engagement with SARS once preservation orders are sought or threatened. Practitioners should advise clients on the potential for early asset realisation by SARS and explore all available legal avenues, including challenging the preservation order or negotiating with SARS, to protect their clients' interests. Understanding the interplay between preservation orders and final execution proceedings is critical for effective tax dispute resolution.