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Register for VAT

When to register?

Compulsory Registration  

It is compulsory for a business to register for VAT if the total value of taxable supplies made in any consecutive twelve month period exceeded or is likely to exceed R1 million. The business must Register for VAT on eFiling or complete a VAT 101 – Application for Registration form and submit it to the local SARS branch within 21 days from date of exceeding R1 million.    

Non-resident suppliers of certain electronic services are also liable for compulsory VAT registration at the end of the month in which the total value of taxable supplies exceeds R1 million. For more detailed information see the VAT-Reg-02-G02 Guide on Foreign Suppliers of Electronic Services and the VAT Frequently Asked Questions for the Supplies of Electronic Services.

The VAT Act also allows an intermediary to register and account for VAT on behalf of supplies made by the non-resident supplier of electronic services.

Voluntary Registration  

A business may also choose to register voluntarily for VAT if the value of taxable supplies made or to be made is less than R1 million, but has exceeded R50 000 in the past period of 12 months.    

There are five categories of voluntary registrations that applies to specific types of persons, as follows:

  1. There is no voluntary threshold for the value of taxable supplies made by the person. This category includes for example the activities of a municipality or a “welfare organisation” as defined in the VAT Act.

  2. The value of taxable supplies made by the person exceeded the voluntary threshold of R50 000 in the past period of twelve months.

  3. The value of taxable supplies made by the person did not exceed the voluntary threshold of R50 000. The requirements and conditions to register under this category is listed in General Notice R.447, as published in Government Gazette No. 38836 dated 29 May 2015 (the Regulation).

Some of the requirements listed under the Regulation are, for example –

    • In the case of a person who has made taxable supplies for only one month preceding the date of application for registration, such person must prove that the value of the taxable supplies made for that month exceeded R4 200;

    • Where the person has not made taxable supplies, such person must have a written contract, in terms of which the person is required to make taxable supplies exceeding R50 000 in the 12 months following the date of registration;
  1. The person acquired the business as a going concern.

  2. The specific nature of activity carried on by the person is listed in General Notice R.447 as Published in Government Gazette No. 38836 dated 29 May 2015 (the Nature of Activity Regulation). Listed activities in the Nature of Activity Regulation include the following:
    • Agriculture, Farming, Forestry and Fisheries
    • Mining
    • Ship and aircraft building
    • Manufacture or assembly of plant, machinery, motor vehicles or locomotives
    • Property development
    • Infrastructure development
    • Beneficiation 

In addition, there are other general requirements that must also be met for a voluntarily registration for VAT.

How does the VAT liability date work?

  • In terms of voluntary VAT registrations, please note that the VAT liability date will be set according to your date of application as the backdating of a voluntary registration is not allowed. If you want to backdate your voluntary registration application, you must provide SARS with the necessary supporting documents to justify the backdating to support your request.

  • For compulsory VAT registrations, the SARS eFiling (RAV01) system only allows backdating up to six months from the date the compulsory registration threshold of R1 million was exceeded. If the backdating is more than six months from the date the compulsory registration threshold was exceeded, please make an appointment to visit a SARS branch  with the necessary supporting documents such as financial statements, signed contracts or invoices issued.        

How to register?

There are two options to register for VAT:

It is important that you submit the correct documents with your VAT registration application. Failure to do so will result in a delay in processing the application. For more information, see the VAT-Reg-02-G01- Guide for Completion of the VAT Application.

 

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Frequently Asked Questions

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