Taxman demands R17m from Lungile Radu & Co’s production company

A television production company owned by actors Lungile Radu, Thomas Gumede, Siyabonga Ngwekazi and Thomas Mhlongo has been hit with a blood-curdling R17.8-million tax bill.
Sunday World can exclusively reveal that the South African Revenue Service (Sars) applied for a default judgment in court last week against the four popular actors’ company, Parental Advisory Productions, after it failed to settle the debilitating bill.
According to the application for the default judgment, which we have seen, the four thespians’ entity, which produced the e.tv telenovela Nikiwe, among other shows, owed Sars more than R7.5-million  in unpaid value-added tax. Sars added over R1.5-million in interest and more than R340 000 in penalties, increasing the total owed to just over R9.4-million.
The four actors’ entity also owed Sars more than R3.2-million in unpaid pay-as-you-earn. But the debt ballooned to more than R4.1-million after the taxman imposed more than R660 000 in interest and over R178 000 in penalties.
Parental Advisory Productions was also indebted to Sars for R2.8-million after failing to pay company income tax, but the figure went up to more than R3.5-million with the addition of more than R690 000 interest.
The television production factory also owed Sars just over R15 000 in unpaid Unemployment Insurance Fund (UIF) contributions. These debts bring the total quantum owed to more than R17.8-million.
Before applying for the default judgment, Sars transmitted a letter to the company on February 10, requesting it to remit payments of more than R9-million. But Radu, Gumede, Ngwekazi and Mhlongo ignored the letter. This resulted in the receiver of revenue dragging their company to court to have it blacklisted, a move that will make it difficult, if not impossible, for it to trade in the private and public sectors.
In the letter, Sars advised the quartet’s entity to pay the breath-taking debt or enter into a payment plan to settle the debt. The taxman threatened to auction off the company’s assets if it failed to remit payment.
“According to the records of the South African Revenue Service, you have failed to pay your tax debt for one or more tax years and tax periods.
“You are requested to make full payment within 10 days from the date of this letter of demand,” read the letter.
In the letter, Sars advised the company to apply within 10 business days from the date of issuance to arrange to pay the debt in instalments if it was unable to pay the full amount.
The actors’ outfit was also advised to apply for suspension of the debt if it intended to submit or had submitted a formal dispute or compromise of a portion of the tax, where this would provide a higher return to the fund than liquidation, sequestration, or other collection measures.
Sars informed the production house that if it did not comply with its demands, it would go to court to seek an order to attach and auction off its assets.
“Failure to make full payment or use the above remedies may result in the following actions and possibly others: Sars may appoint any third party who presently or in the future will owe you money or hold money for you to settle your tax debt with this money.
“A civil judgment is being entered against you, in which case a warrant of execution may be issued for the sheriff of the court to attach and sell your assets.
“If you are a natural person, you may apply for a reduction of the amount to be paid to Sars based on you and your dependants’ basic living expenses.
“If you are a non-natural person, you may apply for a reduction of the amount to be paid to Sars based on serious financial hardship,” the application read.

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