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Tax Talk

Tax Talk

Author: Natalie
Date: 2014-06-06
Registration as a VAT Vendor
All enterprises that trade and are not registered as vat vendors, should monitor the liability to compulsory vat registration, or their eligibility for voluntary registration, on an ongoing basis.

Compulsory Registration
Generally, persons (regardless of the business vehicle) carrying on an enterprise must register as a vendor at the end of any month, where taxable supplies exceed R 1,000,000 in that 12 month period.

A person must register at the beginning of any month where there is reason to believe that taxable supplies will exceed R 1,000,000 in any 12 month period, reckoned from the beginning of that month. (E.g.: If you have a written contractual obligation.)

An exception to this rule amongst various others, is when the value of taxable supplies exceeds the compulsory registration threshold solely in consequence of abnormal circumstances of a temporary nature, no registration is required.

There are also special rules for certain industries, to which the above rules do not apply - the supply of commercial accommodation, such as a "Bed and Breakfast" is one such notable exception seen in Ballito and surrounds, to which special and different rules apply.

Voluntary Registration:
One may apply to the SARS to be registered as a vat vendor on a voluntarily basis. If at the end of any month, the total value of taxable supplies made has exceeded R 50,000 in the preceding 12 month period, or if it is likely to exceed the R50,000 threshold, and this can be proved to the satisfaction of SARS.

Where a vendor was liable to register and failed to, consideration received for supplies made will be deemed to include vat from the date of liability. The vendor must pay over the vat to SARS, from the date liable for registration, with interest and penalties.

Enterprises not registered for vat should monitor their liability closely and ensure they register timeously if and when they do become liable.

To assess your eligibility/ liability to register as a vendor, and what basis would be available to you,make an appointment at Roberts and Chaplin on 032 586 0387, or 032 947 1010.