Fraud and corruption accused Schabir Shaik did not pay any personal income tax because his company had made a taxable loss, the Durban High Court heard on Wednesday.
Ahmed Paruk, from auditing firm David Strachan and Taylor, said the decision was made by his audit partner Paul Gearing and accepted by both him and Shaik.
Paruk said Shaik did not take a salary from the company but took loans. He said the debits in Shaik’s personal account and the loan account of Florin and Clegton investments were eventually written off as development costs in Kobifin, one of Shaik’s companies.
Paruk said this was done after consultation with Shaik who was a substantial shareholder and the sole director of Kobifin.
Paruk said Shaik explained the eventual writing off of R1,2-million by saying he did not owe the company any money, because all expenses incurred had been for the company’s benefit.
He said Kobifin’s overdraft had been maximised and that Shaik said he had used his own overdraft to pay for company expenses.
Paruk’s testimony relates to a fraud charge against Shaik. The alternative charge is tax evasion.
Shaik has pleaded not guilty to fraud and corruption relating to an alleged bribe to Deputy President Jacob Zuma. – Sapa
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