VAT Registration In South Africa

What is a VAT?

A value-added tax, known in some countries as a goods and services tax, is a type of tax that is assessed incrementally. 

VAT Registration In South Africa

You must register your business for Value Added Tax (VAT) if the total value of taxable goods or services is more than R1 million in 12 months, or is expected to exceed this amount.

A business may also register voluntarily if the income earned in the past 12-month period exceeds R50 000.

VAT is an indirect tax on the consumption of goods and services in the economy.

Submit the registration form to your local SARS branch within 21 days from the date of exceeding R1 million.

VAT is levied at a standard rate of 15% on the supply of goods and services by registered vendors. There is a limited range of goods and services that are subject to VAT at the zero rate or are exempt from VAT.

Cancel VAT registration

You may apply to cancel your Value Added Tax (VAT) registration if the value of taxable supplies falls below the limit of R1 million, or if all business activities have stopped.

Your VAT registration will only be canceled if the Commissioner is satisfied that your taxable supplies do not exceed R1 million or that you have discontinued the business.

You must notify the South African Revenue Service (SARS) within 21 days of discontinuing your business.

Your business will remain liable for any outstanding VAT debts while it was registered as a vendor.

Do foreigners have to pay VAT in South Africa?

Where foreigners purchase goods in South Africa, VAT will (generally) be charged at 15%. If all requirements are met, a qualifying purchaser

(i.e. a non-South African resident, tourist, foreign enterprise, or foreign diplomat) may claim a refund from the VAT Refund Administrator (VRA).