VAT Value Added Tax PATC, South Africa. Value added tax VAT was introduced in South Africa on 2. Virtual Villagers 2 Full Version more. September 1. 99. 1 to replace GST General Sales Tax as an indirect system of taxation. Pir Mp Alert Manual. It is levied in terms of the Value Added Tax Act 8. The South African Value Added Tax Act makes allowance for exemptions, exceptions, deductions and adjustments that effectively lower the VAT liability. VAT was imposed in 1. The rate was then increased to 1. We are registered tax practitioners who deliver highly specialized and proficient tax services to individuals and companies who have business interests in South Africa. Value of the total of the aggregate of all assets outside South Africa For the SVDP purposes, the value is the market value determined in the relevant foreign. How does it work As an example a person vendor who carries on a business activity enterprise making a turnover taxable supplies of R1 0. R1m in a 1. 2 month period, is obliged to register with the South African Revenue Services as a VAT vendor and submit VAT returns to SARS. IMG_0911.jpg' alt='Vat201 Form South Africa' title='Vat201 Form South Africa' />As of 1st March 2. R5. 0 0. 00 a year may voluntarily register with SARS as a vendor. VAT translates as the value that is added to the goods or serves. In a basic example you buy a pencil for R3. R4. 0. 0, you have added value of R1. So, to calculate the revenue collected by SARS which you have to pay to SARS for being a Vat Vendor it is the Vat on R1. When you buy the pencil you pay vat on the R3. R0. 4. 2 and when you sell the pencil for R4. What keeps 93 of South African accountants awake at night Yes Invoices Do these 5 situations concern you too 1. You are issuing an invoice. Valueadded tax VAT was introduced in South Africa on 29th September 1991 to replace GST General Sales Tax as an indirect system of taxation. Vat201 Form South Africa' title='Vat201 Form South Africa' />R0. You then pay over the difference to SARS in this case R0. Which is the exact amount of Vat on R1. R0. 1. 4. Business owners are frequently asking how they can trim their VAT bills. The legal implications of withholding important criteria or trying to take short cuts are extremely serious, but with the help of your business tax services expert, you will be able to reduce your bill legally and efficiently. Before you can begin to cut down on VAT bills, you will need to understand how the VAT process works. The basic characteristics of VAT are broken down according to the following points VAT applies generally to transactions relating to goods and services. VAT is proportional to the price charged for these items. VAT is charged at each stage of the production and distribution process. Business owners may deduct tax paid during previous stages, however the burden of the tax is on the final consumer. Issuu is a digital publishing platform that makes it simple to publish magazines, catalogs, newspapers, books, and more online. Easily share your publications and get. Natural numbercrunchers who thrive on organisation and accuracy can capitalise on a lucrative career in bookkeeping with the National Certificate Bookkeeping ICB. To reduce VAT costs, items would need to either fall under the exempt categories, or deduct tax that has been paid during previous stages. You will not have to register for VAT unless you make taxable sales that exceed R1 million over 1. This means that smaller businesses may be exempt from VAT. There are also additional aspects Is your business premises also your home Do you tax your commercial propertyDoes your company deal with overseas customers and export goods and or services PATC Professional Accountants and Tax Consultants has years of experience in dealing with all aspects relating to VAT and other taxes. We will be able to find the best ways to save money and streamline the entire VAT process for your company. VAT is only charged on taxable goods and services made by the business. These supplies do not include goods and services such as salaries, private non business related goods and services sale of private items or exempt supplies. As a business owner in South Africa, VAT only applies to items sold within the country or on items that are imported into South Africa. The current standard rate is 1. Imported items are only charged VAT if the importer of the goods and services is not the business owner, or if the items have been imported for private use or fall into the exempt supplies category. Businesses registered for Vat make VAT payments through a range of channels including posting, SARS branches, EFT, debit orders, e. Filing or any of the major banks. VAT returns are done by completing the required, VAT2. SARS. On registering, vendors will be given a VAT vendor number that needs to be included on all VAT returns and correspondence with SARS. If vendors have not submitted a return in the past five years, or their VAT2. Vat registration number suspended. VAT returns must be submitted within 2. VAT cycle, or the vendor can face penalties and interest on late compliance. Penalties are 1. 0 of the amount payable while interest is levied at a standard interest charge. Vendors with an annual turnover of less than R 1. VAT returns every four months. However, they may have the choice to stay on the two monthly return cycle. Vendors will also have to keep all financial records for a period of five years from the date of the last entry in any book. VAT Tips for Small Businesses. While many small businesses assume that VAT does not apply to them as it would for larger businesses, every business in South Africa that provides goods or services is in fact required to register for VAT. Failure to comply could cause serious problems something that very few small businesses are able to recover from in the event of fines or other consequences. To ensure that your VAT is in order, consider the following VAT tips for small businesses All invoices must reflect correct VAT registration numbers for the supplier and receiver of goods and services this will ensure that all invoices inter alia are correct and in order. Ensure that your turnover and financial statements match this is something that SARS checks regularly. If the financial statement figures differ from your turnover per your Vat returns, this indicates a potential problem, and SARS might be forced to ask questions. Never inflate your claim another reason why it is best to have a professional accountant manage your taxes. An inflated input claim could either incorrectly reduce your VAT liability, or result in a refund for an amount far greater than is legally due to you. This is also considered a criminal offence. Claim back the VAT paid on bad debts you have the right to claim back VAT paid on all your debts that have become irrecoverable. You will however first need to write this debt off speak to your professional accountant to find out how this is done. All quotes must include VAT even if the VAT rate is 0. You will need to include VAT on every quote that is sent out to your customers and clients. Keep documentary proof of zero rating if you do not charge VAT, you can still claim for VAT on the items supplied, however you must always keep proof that you are entitled to do so, or otherwise SARS will raise a red flag. Make sure SARS meets deadlines if you do not receive your VAT refund within 2. Phoenix Software For Windows 7. SARS receiving your VAT2. SARS to pay you interest at the prescribed rate. Charge VAT on your commission this is known as output tax and must be paid to SARS on your VAT return. You can then issue tax invoices to the companies that are paying you commission. Submit returns regardless even if you calculate that you have no VAT liability and no VAT payment due to SARS, as a registered vendor you must still submit your returns. Your professional accountant can handle your returns on your behalf, allowing you to get everything in order to meet SARS compliancy. Key Points to Know About VATIf your business supplies products and services to the public, you will need an accountant to assist you in calculating your VAT that is owed to SARS. Some important points to note about VAT include the following If you run a business you are required by law to include 1. This percentage will be paid to the South African Revenue Service SARS. You are however entitled to claim back any VAT that has been incurred while running your business, this is referred to as input VAT.