Tax troubles for the Shilimelas
The wife of well-known northern-based businessman Banda Shilimela has dragged the taxman to court after the latter froze several of her bank accounts due to alleged outstanding value-added tax (VAT) of about N$21 million.
Esser Naukosho, in court papers filed last week, said she remains “without access to any money because the Namibian Revenue Agency [NamRA] has allegedly frozen my bank accounts for reasons unknown to me”.
NamRA maintained that the Shilimelas were aware of their VAT liabilities from as far back as 2022.
“I have no way to support myself. The consequences of NamRA's actions are and will be devastating to me," Naukosho said in her urgent application against the revenue agency.
The parties appeared in the Windhoek High Court yesterday in an application in which she seeks to have NamRA’s decision to freeze and withdraw funds from four of her bank accounts reviewed and set aside.
Constitutional right
She claimed that NamRA did not give her reasons for its decision before the agency froze her accounts on 8 October.
She believes this is in conflict with her constitutional right to fair and reasonable administrative action.
Naukosho has further demanded that First National Bank [FNB] Namibia be ordered to immediately make the money in her accounts available to her.
According to commissioner Sam Shivute, NamRA carried out an investigation in 2022, during which it was found that Naukosho allegedly used her personal accounts, registered in her name, as a conduit to make various payments on behalf of her husband's business, Shilimela Security and Debt Collection.
The investigation found that the company apparently did not comply with its VAT requirements.
“FNB has been instructed by NamRA to freeze the accounts if there are insufficient funds, and any funds coming into the accounts must be transferred to the government account with immediate effect until the total balance is settled,” Shivute said.
“In any case, [the business] received notices on different occasions and was reminded several times of its outstanding VAT contributions, which [were] ignored. The current tax liability stands at N$21.3 million, which includes penalties and interest in addition to the capital amount,” court papers read.
‘Substantial error’
Shivute explained that tax legislation considers spouses as separate taxpayers - even if they are married in community of property.
"Hiding or diverting money to another person's bank account is an act of concealing the true source of money that should have been properly declared and subjected to tax assessments," he said, adding that Shilimela Security and Debt Collection used Naukosho accounts for business transactions without meeting the VAT requirements.
"[Naukosho], who allowed her account to be used by [the business], owes NamRA more than N$20 million.”
Naukosho claimed in court papers that NamRA should have provided reasons for its decision, and that the failure to do so before taking action is "unfair and unreasonable".
“There is no dispute that the accounts referred to in the notice belong to [Naukosho] and not to [Shilimela Security and Debt Collection]. It therefore follows that NamRA could not appoint FNB to collect money from my bank accounts when [the business] owes money. By doing so, NamRa made a substantial error and the decision must be reviewed and set aside based on this," she claimed.
The case was yesterday postponed until 15 November, when a verdict is expected to be delivered.
Esser Naukosho, in court papers filed last week, said she remains “without access to any money because the Namibian Revenue Agency [NamRA] has allegedly frozen my bank accounts for reasons unknown to me”.
NamRA maintained that the Shilimelas were aware of their VAT liabilities from as far back as 2022.
“I have no way to support myself. The consequences of NamRA's actions are and will be devastating to me," Naukosho said in her urgent application against the revenue agency.
The parties appeared in the Windhoek High Court yesterday in an application in which she seeks to have NamRA’s decision to freeze and withdraw funds from four of her bank accounts reviewed and set aside.
Constitutional right
She claimed that NamRA did not give her reasons for its decision before the agency froze her accounts on 8 October.
She believes this is in conflict with her constitutional right to fair and reasonable administrative action.
Naukosho has further demanded that First National Bank [FNB] Namibia be ordered to immediately make the money in her accounts available to her.
According to commissioner Sam Shivute, NamRA carried out an investigation in 2022, during which it was found that Naukosho allegedly used her personal accounts, registered in her name, as a conduit to make various payments on behalf of her husband's business, Shilimela Security and Debt Collection.
The investigation found that the company apparently did not comply with its VAT requirements.
“FNB has been instructed by NamRA to freeze the accounts if there are insufficient funds, and any funds coming into the accounts must be transferred to the government account with immediate effect until the total balance is settled,” Shivute said.
“In any case, [the business] received notices on different occasions and was reminded several times of its outstanding VAT contributions, which [were] ignored. The current tax liability stands at N$21.3 million, which includes penalties and interest in addition to the capital amount,” court papers read.
‘Substantial error’
Shivute explained that tax legislation considers spouses as separate taxpayers - even if they are married in community of property.
"Hiding or diverting money to another person's bank account is an act of concealing the true source of money that should have been properly declared and subjected to tax assessments," he said, adding that Shilimela Security and Debt Collection used Naukosho accounts for business transactions without meeting the VAT requirements.
"[Naukosho], who allowed her account to be used by [the business], owes NamRA more than N$20 million.”
Naukosho claimed in court papers that NamRA should have provided reasons for its decision, and that the failure to do so before taking action is "unfair and unreasonable".
“There is no dispute that the accounts referred to in the notice belong to [Naukosho] and not to [Shilimela Security and Debt Collection]. It therefore follows that NamRA could not appoint FNB to collect money from my bank accounts when [the business] owes money. By doing so, NamRa made a substantial error and the decision must be reviewed and set aside based on this," she claimed.
The case was yesterday postponed until 15 November, when a verdict is expected to be delivered.
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