VAT Connect Issue 11 (September 2020)

The term "imported services" refers to a situation where the supply of services is made by a person who is not a resident of the Republic (or who carries on business outside the Republic) to a recipient who is a resident of the Republic. The services concerned are only regarded as taxable to the extent that such services are for use or consumption in the Republic for non-taxable purposes.

The declaration and payment of any VAT on imported services must be done as follows:

  • If the recipient is registered as a vendor in the Republic, the VAT must be declared on the VAT 201 return (block 12) and paid together with any other VAT that is payable by that vendor in the normal manner.
  • If the recipient is not registered as a vendor in the Republic, the VAT liability must be declared on the VAT215 record. The payment thereof must be done on eFiling or through a prescribed method for exceptional cases such as where the Basic Accounting System (BAS) is used for processing payments. Once the payment has been processed, the payment confirmation receipt number from eFiling must be captured on the VAT215 record, which must be retained by the recipient for a period of five years. Where payment is not received, SARS may issue an assessment for the VAT payable on the imported services acquired.

Refer to the Manage Imported Services – External Guide for more details in this regard.

Recipients of imported services should confirm whether the non-resident supplier is registered for VAT in the case of any “electronic services” supplied, because in such a case, the supplier should be charging VAT instead of the recipient declaring VAT on imported services.

Refer to the Frequently Asked Questions: Supplies of Electronic Services for more details in this regard.

In order to check whether the non-resident supplier is correctly charging VAT or should be charging VAT, the recipient may use the SARS VAT Vendor Search function to verify the VAT status of the supplier. Suspicious activity can be reported online via the SARS Report a Suspicious Activity page.

Disclaimer

VAT Connect is an information guide and not an "official publication" as defined in section 1 of the TA Act and accordingly does not create a practice generally prevailing under section 5 of that Act. It is also not a binding general ruling (BGR) under section 89 of Chapter 7 of the TA Act nor a ruling under section 41B of the VAT Act. For general enquiries regarding VAT call the SARS Contact Centre on 0800 00 7277. Should there be any aspects relating to VAT on which a specific VAT ruling is required, you may apply for a ruling by completing form VAT301 and sending it together with all the necessary information to SARS by facsimile on +27 86 540 9390 or by e-mail to [email protected]. Refer also to the Quick Reference Guide on VAT Ruling Application Procedure for more details on how to apply for a ruling.
Last Updated: 23/09/2020 5:40 PM     print this page
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