VAT Refunds for tourists and foreign enterprises

VAT Refunds to Qualifying Purchasers, such as tourists and foreign enterprises

What is the VAT refund mechanism? 

South Africa has a VAT refund mechanism to refund the amount of VAT that is charged at 15% and paid on the acquisition of goods by a qualifying purchaser. The qualifying purchaser must submit a claim for the VAT refund at the time of departure from South Africa or at the time the goods are exported by the qualifying purchaser from South Africa. The qualifying purchaser must fulfil the conditions and requirements listed in Part One of the Export Regulation.  Regulation R316 in terms of the definition of ‘Exported’ in the VAT Act as in GG 37580.

The VAT refund only applies to the acquisition of goods by the qualifying purchaser and not on the acquisition of services.  For more information on the process regarding the submission of a  VAT refund claim, please refer to the External Guide: VAT refunds in terms of Part 1 of the Export Regulation no. 316  and the Part One of the Export Regulation. 

Special rules apply when claiming a VAT refund  on the acquisition of registrable goods and second-hand goods. For more information in this regard, please refer to the Guide and the Export Regulation.

Who may claim a VAT refund? 

A qualifying purchaser or a qualifying purchaser’s cartage contractor may claim a VAT refund in respect of the VAT that is charged at 15% and paid on the acquisition of goods. A qualifying purchaser includes, but is not limited to, a –

• tourist;
• foreign diplomat;
• foreign enterprise; and
• a non-resident of South Africa.

For a complete list of persons that are qualifying purchasers, please refer to the definition of “qualifying purchaser” in the Export Regulation.

How do I claim a VAT refund? 

A qualifying purchaser, may claim a refund of VAT paid on the acquisition of goods by submitting a VAT refund claim to the VAT Refund Administrator (the VRA).

The qualifying purchaser must, amongst others, present himself, together with the goods that were acquired to a Customs and Excise official at one of the listed designated commercial ports from where the qualifying purchaser will departure from South Africa. The tax invoice for goods that are not kept as hand luggage must be endorsed by the Customs and Excise official and a VRA official, if the VRA has a physical presence at the port of exit. If the VRA does not have a physical presence, the qualifying purchaser must apply in writing to the VRA. A list of commercial ports is set out below. 

For more information on how to submit a VAT refund claim, refer to the Guide and the Export Regulation.

When will a VAT refund be considered?

A VAT refund will be considered if the following requirements, amongst others, are met:

• The purchaser must be a qualifying purchaser as defined in the Export Regulation.
• The goods must be exported within 90 days from the date of the tax invoice, subject to certain exceptions listed in Part One to the Export Regulation
• The VAT inclusive total of all movable goods purchased during a particular visit to South Africa and exported at the end of that visit by the qualifying purchaser must exceed the minimum of R250 per qualifying purchaser.
• The request for a VAT refund, together with the relevant documentation (as listed in the Export Regulation), must be received by the VRA within 90 days of the date of export.
• The goods must be exported through one of the 43 designated commercial ports by the qualifying purchaser or the qualifying purchaser’s cartage contractor.
• The qualifying purchaser must submit all the relevant original documentary proof as contemplated in Part One of the Export Regulations in order to prove that the movable goods were exported by road, sea, air or rail.

The 43 designated commercial ports are: