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Value Added Tax

What is new?

  • 7 December 2020 – VAT enhancements were implemented

    • As part of the VAT Refund Relief for Covid-19, an additional enhancement has been implemented on eFiling, which allows the VAT Control Table to be visible for all users. The VAT Control Table will display returns for the last 5 years and 1 year into the future. For example, if the current date is July 2020, then the Table will display past returns up to August 2015, and one year into the future to June 2021.

    • The VAT201 declaration form on eFiling has been converted from Adobe Flex to HTML5 format for better user experience and compatibility. 

    • See the updated Guide for completing the Value Added Tax VAT201 Declaration.

  • 1 June 2020 – Payment of VAT liability declared in VAT 215 and VAT 216 records

    The payment of the VAT liability declared in the VAT 215 and VAT 216 records must be made on
    eFiling by the following persons:

    • In the case of the VAT 215 record, the recipient (where the recipient is not a registered vendor) of imported services (as defined),

    • In the case of the VAT 216, the seller of goods, in relation to goods sold in satisfaction of debt envisaged under section 8(1) to pay an amount of VAT to SARS.

In terms of section 55 of the VAT Act, read with section 29 of the Tax Administration Act, the VAT 215
and VAT 216 records and the relevant invoices or tax invoices (whichever are applicable) are required
to be retained by the client as relevant material.

 

  • 25 May 2020 – Immediate allocation of a new VAT number upon application
    SARS will issue a VAT reference number immediately to all applicants who submitted through eFiling or walk-in channel, if no risk has been identified. The requested supporting documents can be submitted through eFiling, SARS website online query system or walk-in channel, latter by appointment only. See the updated guide for info.

     

  • 18 May 2020 – COVID-19 VAT Refund Relief for Vendors
    See our list of FAQs.

     

  • 28 March 2020 – VAT vendors can now request and obtain a VAT Notice of Registration on eFiling if they are registered on SARS eFiling:

    Follow these easy steps:
    1.    Login to SARS eFiling
    3.    Go to the Organizations main menu
    4.    Click SARS Registered details on the side menu
    5.    Select Notice of Registration
    6.    Select VAT
     
    Please note that you must be registered on SARS eFiling in order to use this service.

  • 9 September 2019 New VAT216 form available

    A new VAT216 form, Record in respect of goods sold towards satisfying a debt of the owner of the goods, has been published and should be completed and retained for all payments related to goods sold to satisfy the debt of the owner of the goods, as envisaged in section 29 of the Value-Added Tax Act, 1991.  

    The VAT216 form is updated to automatically apply the applicable tax fraction to the selling price, inclusive of VAT, dependent on the date of the sale. For example, if goods were sold before 1 April 2018, the tax fraction of 14/114 will be applied. 

 

Set-off of refunds between main account and sub accounts for VAT

SARS has implemented an improved VAT refund process in line with legislative changes which saw the new section 50(70) incorporated into the VAT Act No. 89 of 1991.

From September 2019, taxpayers will be able to use a VAT refund from the main account of an enterprise to pay the VAT debt of another sub-account or branch of the enterprise.

If you have a VAT refund due on the main or sub-account, it can be used as follows:

  • The main enterprise can set-off  an outstanding tax debt of another branch
  • The branch account can be set-off against an outstanding tax debt of the main enterprise or an outstanding tax debt of another branch.

Once the set-off has been successfully completed, a Notice of Refund VAT222 will be issued indicating the tax period(s) of the payment, VAT registration number, tax debt to be paid, refund set-off, and the account reference numbers from which the refund was made.

 

21 February 2018 – Budget 2018 announcement
VAT is now levied at the standard rate of 15% on the supply of goods and services by registered vendors. The tax rate was 14% until 31 March 2018.

A vendor making taxable supplies of more than R1 million per annum must register for VAT. A vendor making taxable supplies of more than R50 000 but not more than R1 million per annum may apply for voluntary registration. Certain supplies are subject to a zero rate or are exempt from VAT.

For more information on the impact of the VAT increase, see the:
 

These documents can still be relied upon, and reference to the 14% VAT rate must be substituted with the increased rate of 15% where applicable and read within the context of the reference.

Until the prioritised documents are updated, the Frequently Asked Questions (FAQs) and related answers will be the primary information source in relation to the VAT rate increase. If your particular question is not addressed in the FAQ document, you can direct that question to [email protected].

What is VAT?

Value-Added Tax is commonly known as VAT. VAT is an indirect tax on the consumption of goods and services in the economy. Revenue is raised for government by requiring certain businesses to register and to charge VAT on the taxable supplies of goods and services. These businesses become vendors that act as the agent for government in collecting the VAT.

VAT is charged at each stage of the production and distribution process and it is proportional to the price charged for the goods and services.

VAT increased from 14% to 15% from 1 April 2018. VAT is levied on the supply of most goods and services and on the importation of goods. The VAT on the importation of goods is collected by customs. There is a limited range of goods and services which are subject to VAT at the zero rate or are exempt from VAT.

Who should register for VAT?

Any person that carries on a business may register for VAT. You can register once for all different tax types using the client information system. The term person is not only limited to companies but also includes, amongst others, individuals, partnerships, trust funds, foreign donor funded projects and municipalities. In order to register, an application form must be completed and a specific process must be followed, both of which you can find on our page how to register for VAT.
 
It is mandatory for a person to register for VAT if the taxable supplies made or to be made is, in excess of R1 million in any consecutive twelve month period.
 
A person may also choose to register voluntarily if the taxable supplies made, in the past period of twelve months, exceeded R50 000. As from the 1st of March 2012, qualifying micro businesses that are registered for Turnover Tax may also choose to register for VAT provided that all the conditions for voluntarily registration for VAT are met.
 
A person who is obliged to register for VAT is referred to as a vendor.

When should I submit returns and make payments?

A vendor is required to submit VAT returns and make payments of the VAT liabilities (or claim a VAT refund) in accordance with the tax period allocated to the vendor. The VAT returns and payments are normally submitted / made on or before the 25th day after the end of the tax period. Late payments of VAT will attract a penalty and interest.
Payment methodReturn due datePayment due date
Payments at ABSA, Albaraka Bank Limited, Access Bank (previously Grobank), FNB, HBZ Bank LTD, Nedbank and Standard Bank.25th25th
Electronic Fund Transfers (including internet banking)25th25th
eFiling of return and payment via either SARS eFiling or Electronic Funds Transfers (internet banking)Last business dayLast business day

Top Tip: On 19 October 2012, SARS clarified in a notice that vendors who use eFiling may continue to submit their VAT declarations on the 25th of the month. The benefit of no interest, penalties or prosecution will remain effective if the declaration and payment are submitted via eFiling (or EFT) on or before the last business day of the month.

How do I access older VAT-related documents?

The SARS website does not host old or withdrawn documents, except for those owned by Legal & Policy, for example earlier published Proclamations, Regulations and Government Notices, as well as the archived VATNews copies.
The VATNews copies can be found in the Legal & Policy Archive, which has been made available for research and reference purposes.
Related Documents

GEN-ELEC-04-G01 – Guide for completing the Value Added Tax VAT201 Declaration – External Guide

GEN-ENR-01-G01 – Guide for the submission of third party data using the connect direct channel – External Guide

GEN-ENR-01-G02 – Guide for Submission of Third Party Data Using the HTTPS Channel – External Guide

GEN-REG-01-G04 – How to Complete the Registration Amendments and Verification Form RAV01 – External Guide

LAPD-Gen-G01 – Taxation in South Africa

LAPD-Gen-G02 – Guide for Tax Rates Duties Levies

LAPD-Gen-G08 – Guide on the Taxation of Professional Sports Clubs and Players

LAPD-IT-G19 – Comprehensive Guide to Dividends Tax

LAPD-IT-G21 – Guide on the Taxation of Foreigners working in South Africa

LAPD-IT-G24 – Guide on Mutual Agreement Procedures

LAPD-TAdm-G01 – Short Guide to the Tax Administration Act 2011

LAPD-VAT-G01 – VAT 403 Vendors and Employers Trade Classification Guide

LAPD-VAT-G02 – VAT 404 Guide for Vendors

LAPD-VAT-G03 – VAT 409 Guide for Fixed Property and Construction

LAPD-VAT-G04 – VAT 411 Guide for Entertainment Accommodation and Catering

LAPD-VAT-G05 – VAT 412 Guide for Share Block Schemes

LAPD-VAT-G06 – VAT 413 Guide for Estates

LAPD-VAT-G07 – VAT 414 Guide for Associations not for Gain and Welfare Organisations

LAPD-VAT-G08 – VAT 419 Guide for Municipalities

LAPD-VAT-G09 – VAT 420 Guide for Motor Dealers

LAPD-VAT-G10 – VAT 421 Guide for Short Term Insurance

LAPD-VAT-G11 – VAT Rulings Process Reference Guide

LAPD-VAT-G12 – VAT and PAYE NonExecutive Directors FAQs on BGRs 40 and 41

LAPD-VAT-G13 – Pocket Guide on the VAT rate increase on 1 April 2018

LAPD-VAT-G14 – VAT FAQs Increase in the VAT Rate from 1 April 2018

LAPD-VAT-G15 – VAT Quick Reference Guide for Non-Executive Directors

LAPD-VAT-G16 – VAT FAQs Supplies of electronic services

LAPD-VAT-G17 – VAT Reference Guide for Foreign Donor Funded Projects

SPPOA – Special Power of Attorney – External Form

TPPOA – Special Power of Attorney to Tax Practitioner – External Form

VAT 411 – Guide for Entertainment Accommodation and Catering – External Guide

VAT-ELEC-01-G01 – Manage Value Added Tax on Imported Services – External Guide

VAT-REG-02-G01 – Guide for Completion of VAT Application – External Guide

VAT-REG-02-G02 – Foreign Suppliers of Electronic Services – External Guide

VAT101 – Value Added Tax Registration Application – External form

VAT101D – Application for Registration of Diesel Refund – External Form

VAT102 – Application for separate registration VAT – External form

VAT102D – Application for Registration of Diesel Refund – External Form

VAT102DIP – Application for Separate Registration of Offices of International Organisations – External Form

VAT117 – Application for Change in Accounting Basis – External Form

VAT119i – Indemnity iro VAT Act Bank Details – External Form

VAT121 – Application for Category E – External Form

VAT123D – Application for the Cancellation of Diesel Registration of a Person – External Form

VAT123T – Application for Cancellation of a Separately Registered Enterprise – External Form

VAT125 – Declaration by Representative Vendor – External Form

VAT128 – Confirmation of Partnership – External Form

VAT201 – Vendor Declaration – Sticky Notes

VAT202e – Notice of Change of Tax Period iro the Submission of a Return VAT 201 – External Form

VAT215 – Record in respect of Imported Services – External Form

VAT216 – Return iro Goods Sold for Settlement of Debt of Holder of the Goods – External Form

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