Value-Added Tax (VAT) basics - South Africa 2018

[@minenhlehlophe2862]

Hi Jacques, thanks for this informative video. I'm writing an online test later today🌚

[@tshephovalentiajonker2622]

Hi, can you please explain vat implications on imported good (second hand), fringe benefits, donations to a connected person or connected persons in general and commercial accomodation (the more than 28 days and R120000 rule, and at what percentage it is claimed at), indemnity payments. Thanks

[@JJTAcc]

Hey Tshepho Sorry for not responding sooner. I've been working on making videos on some of these queries you had. However these queries are a very technical to explain and most of them require a video on their own. Keep an eye out, they're in the making.

[@SheldonZam]

Thanks for the video bro. I appreciate educational videos

[@Brett_Flow]

Jacques, time code 7:12 hahaha, Passenger transport: taxi's (drivers/associations) don't pay vat or the passengers don't pay vat?

[@JJTAcc]

Hi Brett. Thanks for the question. I realise when I said "the taxi industry don't pay VAT", it can be interpreted incorrectly. A taxi driver is not allowed to charge VAT for the transportation of his passengers. If your company for example rents a taxi for a day to take you on a tour, this will be non-VAT-able. However, the tour guide's fees will be a VAT-able supply. Also, taxi-associations' income is not derived from the provision of those services, but rather the management of the providers of those services. And management carries VAT at the standard rate.

[@LMokhele]

Hi Jacques with regards to registering for VAT when you see that you are about to reach the 1M turnover or the voluntary registration assuming that you'll reach 50k in turnover, once you register say in the 9th month, are you still expected to submit the VAT returns of the 9 months you were not registered as well as the months going forward? I understand that rental income is exempt from VAT, can you still claim input Tax for say your security, rates and taxes, water, electricity, internet, cleaning services, etc. costs? Should you wish to renovate the place, the VAT charged by the contractor and architect, can they too be claimed back?

[@JJTAcc]

Hey Lehlonolo. Great question. In order to register for VAT on a voluntary basis, you need to prove that your taxable supplies exceed the R50 000 mark. Once you register, you will get a date of first liability on your registration certificate. That is the date from when you need to start filling and charging VAT. When it comes to rentals, the rental of commercial properties are considered a taxable supply. Rental of residential accomodation also, but there is a VAT exemption on a portion thereof. Once registered for VAT, you can claim vat on most services/products sourced from VAT vendors, with a couple of specific exceptions.

[@LMokhele]

Thnanks, much appreciated

[@lindiwemashaba8491]

Good evening sorry I know this might be out of your topic but just want to know if you may assist with a site that I can go to and check influences Vat has on SMME’s

[@BigAL-x7f]

Just to clarify, If I buy food ingredients from a food supplier who's price is ' EXCL VAT' and I use these ingredients to re-sell as my own food item (packaged salad) to a general consumer, I pay the tax to the supplier and then include tax on my food item to the general customer and then claim back the tax that I paid to the supplier?

[@JJTAcc]

Hi Alec That is a good question. The answer is yes and no. Yes, if you are a VAT vendor, you will have to charge VAT on the ready-to-eat packaged salad (because you packaged it and made it ready-to-eat: this is a VATable supply) and pay the VAT Output to SARS. No. If the supplier you bought the ingredients from is not VAT registered, then you can't claim back VAT seeing as there was no VAT Input you paid. Also, even if the supplier is VAT registered, most fresh produce is exempt from VAT so chances are there is no VAT Input anyway. However, if you are a major clothing and food retailer and purchase "packed ready-to-eat" salads from a VAT registered supplier and you sell that to your customers again, then you will have both VAT output and VAT Input in your return for that period. I hope this helps. Thanks for watching!

[@BigAL-x7f]

​@@JJTAcc Thank you very much.

[@JJTAcc]

@@BigAL-x7f You're welcome

[@Macedii_]

Hey. Can you claim for input vat for tracing fees paid to a tracing company by a law firm? (If you outsourcing for this service)

[@JJTAcc]

If both of you are registered, and VAT was charged, yes.

[@khanyamosinki8110]

Woah, did you just say that VAT is a direct tax?

[@JJTAcc]

If I did, it most likely may have been a verbal error. VAT is most certainly an INDIRECT Tax, where the person paying the tax to SARS is not the same as the person eventually bearing the burden of tax. If I did say it's a direct tax, thank you for pointing that out. Sorry for the confusion.

[@SheldonZam]

Second! ✌️

[@erictheawesomest]

the tax system in this country is way too complicated.

[@lwazimateza499]

Tell me about it

[@JJTAcc]

That's why we're here. 😉😄