SARS enforces VAT registration
SARS has, in accordance with s23(4)(b) of the VAT Act, always had the right to enforce VAT registration when a company exceeds R1m VATable turnover.
We have never known this to be enforced. Until now!
There’s a department within SARS called Tax Base Broadening, Education and Outreach that we’ve never heard of before. My AI search couldn’t find out when it was established.
It recently sent a letter to a client advising that his company must, within 10 days of the letter, apply for VAT registration failing which SARS would register the company for VAT in accordance with s22(5) of the Tax Administration Act (which simply repeats what s23(4) of the VAT Act says).
In the client’s case, his company is a long term residential letting company and, as such, is not liable to register for VAT. We are still trying to find out how we stop the process.
But, be warned. If you should be VAT registered, then get VAT registered (we can assist if you wish). Otherwise they can deem all transactions subsequent to your company passing the R1m mark to have included VAT which will then be payable to SARS with interest.
2 comments
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How much do you charge for vat registration ,
How long does it take to register ?
What documents do you require
Can we claim vat invoices prior to vat registration and for how far back , should our suppliers reissue tax invoice with our tax registered details
Thank you
Hi Haroon,
I will send you a quotation by email.
VAT registration is becoming ridculously difficult with the new biometric requirement on top of the previous hoops that we had to jump through. So, I can’t tell you how long, because I don’t know what additional questions SARS may come back with. We will give you a list of requirements if you decide to go ahead with us.
You can claim the VAT on purchases invoiced after the “Date first liable”. That date is selected by you when we make the application. However, you have to be aware that all your invoices out are deemed to have included VAT from that date. So, if your suppliers are going to reissue invoices, they should date them post date first liable in order that you can claim.