What is Turnover Tax?
A turnover tax is similar to VAT, with the difference that it taxes intermediate and possibly capital goods. It is an indirect tax, typically on an ad valorem basis, applicable to a production process or stage.
For example, when manufacturing activity is completed, a tax may be charged on some companies.
How To Register For Turnover Tax In South Africa?
How to register for Turnover tax?
- Do a quick test to see if you qualify for turnover tax
- If you qualify, fill in a TT01 application form:
- TT01 – Application for Turnover Tax form (Manual completion)
- TT01 – Application for Turnover Tax form (Online completion)
When should an application for registration be submitted?
It should be sent before the beginning of a year of assessment (a year of assessment runs from 1 March to 28 February), or a later date that may be determined by the Commissioner in a Government Notice.
The timing differs slightly for new registrations and existing registered businesses:
- New businesses: Should a new micro business start trading during a year of assessment and wishes to register for turnover tax, an application must be sent within two months from the date that the business started.
- Existing businesses: existing micro businesses can register for or switch to turnover tax before the start of a new tax year.
The following channels can be used to submit Turnover Tax returns:
- Make an appointment on our eBooking system.
- Or email SARS
SARS will send you a letter about the outcome of the application. Where the submitted TT01 form is incomplete, the taxpayer will be informed and the application will be re-considered once all of the information has been provided.
How does deregistration work?
- Voluntary deregistration: A person may elect to voluntary de-register before the beginning of a year of assessment or a later date announced by the Commissioner in a Government Notice. Deregistration will be effective from the beginning of that year of assessment.
- Compulsory deregistration: You may be forced to deregister if your turnover exceeds R1million for a given tax year or certain qualifying criteria are no longer met (paragraph 3 of the Sixth Schedule). In the case of a compulsory deregistration, the business will be deregistered from the beginning of the month following the month during which they no longer qualify for turnover tax.
How to complete the TT01 form
When opening a TT01 application form, you will be required to complete the Quick Test before the form opens up further.
If the answer to any of the Quick Test questions is “No”, the business will not
qualify for Turnover Tax.
If the Quick Test is not completed correctly the following error message will appear:
On completion of the Quick Test click “Create Form” and the following message will appear:
Particulars of applicant
Indicate whether the applicant is a:
- Sole proprietor (individual)
- Partnership
- Close Corporation
- Co-operative or
- Company
by ticking the appropriate box.
Failure to tick any of the boxes will result in the rejection of your application.
Establishment date
This is the date on which the business was started. Please ensure that the CCYYMMDD format is used
e.g. 20020601 for a business that started trading on 01 June 2002.
Registered name
This is the name that the business is legally registered under with the relevant authority e.g.
Companies and Intellectual Property Commission (CIPC).
This is a mandatory field only if the close corporation, co-operative or company box at the top of the form is ticked.
How do I qualify for turnover tax in South Africa?
You’re only eligible for turnover tax in South Africa if you’re considered to be a micro business.
A micro business, or a micro-enterprise, is a business that doesn’t see its annual turnover exceed R1 million. So, if your business has a turnover that’s less than R1 million you might be eligible to register.
Is turnover tax the same as VAT?
The VAT return is also called turnover tax return. Value-added tax, VAT, applies to products and services. You pay VAT on your turnover.