Value-Added Tax

What is new?

  • 3 August 2022The August issue of the VAT Connect newsletter is available.

  • 1 July 2022 – VAT domestic reverse charge (DRC) on valuable metal from 1 July 2022

    A VAT domestic reverse charge (DRC) on valuable metal was introduced in the Regulation published in Government Gazette 46512 on 8 June 2022, see Regulations on domestic reverse charge relating to valuable metal, issued in terms of section 74(2) of the Value-Added Tax Act, 1991 (Act 89 of 1991), Notice 2140.  The DRC Regulations came into effect on 1 July 2022. For a comprehensive understanding of these Regulations, see the Explanatory Memorandum and Media Statement.

For more information see the VAT Domestic Reverse Charge webpage.

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 a business, that carries on an enterprise (as defined in section 1(1) of the VAT Act), to register for VAT. In doing so, the business will charge VAT on supplies of goods and services made by it, on the importation of goods and on imported services (subject to certain conditions). The business will also be entitled to deduct any VAT charged to it, or under limited circumstances from a business that is not registered for VAT, in respect of a supply made to it. VAT is therefore non-cumulative, meaning that a credit/deduction is allowed for VAT paid in previous stages, within the production and distribution chain. The business is required to pay the difference between the VAT charged by it and the VAT charged to it, or claim a VAT refund where the VAT charged to it exceeds the VAT charged by it.

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

The standard rate of VAT increased from 14% to 15% from 1 April 2018. 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 an enterprise, as defined in section 1(1) of the VAT Act, may qualify to register for VAT. A person is a defined term and includes a company, individual, partnership, trust fund, and a municipality. In order to register, follow the application process as detailed on our page how to register for VAT.

It is compulsory for a person to register for VAT if the value of 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 value of taxable supplies made, or to be made, is not in excess of R1 million in any consecutive twelve month period.

There are five categories of voluntary registrations:

  • The first category applies to a specific type of person where there is no threshold for the value of taxable supplies.
  • The second category applies to a person that has made R50 000 in the past period of twelve months.
  • The third category applies to a person where the value of taxable supplies has not exceeded R50 000 and the conditions for registration are listed in a Regulation.
  • The fourth category applies to a person that has acquired a business as a going concern.
  • The fifth category applies to a person that carries on a specific nature of activity as listed in a Regulation.  In addition, there are other general requirements that must also be met for a voluntarily registration for VAT.

A person who is registered (under compulsory or voluntary registration) or required to be registered (under a compulsory registration) for VAT is referred to as a vendor.

You can register once for all different tax types using the client information system.

When should I submit VAT returns and make payments?

A vendor is required to submit VAT returns and make payments of the VAT liabilities (or claim a VAT refund) on or before the 25th day or the last business day of the month following the month in which the vendor’s tax period ends. If the 25th day is not a business day, the day for submitting a return and making payment will be the business day preceding such day. Late payments of VAT will attract a penalty and interest.

Payment methodVAT return 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

How do I access VAT-related documents?

See the Related Documents section below where you will find for example the VAT 404 – VAT Guide for Vendors. The SARS website does not host old or withdrawn documents, except for Legal Counsel publications such as, published Proclamations, Regulations and Government Notices, as well as the archived VATNews.

The VATNews publications can be found in the Legal & Policy Archive, which is made available for research and reference purposes.

To access this page in different languages click on the links below:

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

Legal-Pub-Guide-Gen01 – Taxation in South Africa

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

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