VAT

Question 1

What is compulsory registration?

Answer 1

All businesses with a turnover of more than R1 million must register as a vendor (trader)

Question 2

What is voluntary registration?

Answer 2

Businesses with a turnover of less than R1-million can register if they want to.

Question 3

Zero-rated items

Answer 3

Items charged at 0% VAT, but this can be changed by the government at any time. Examples are fresh fruit and vegetables, brown bread, milk, maize, rice, lentils and cooking oil.

Question 4

VAT-exempt items

Answer 4

Items on which no VAT is charged. Examples are interest, rates, export services, educational services and childcare services

Question 5

VAT input

Answer 5

VAT input is the VAT paid by a business on the purchases of goods and services (which can be claimed back from SARS)

Question 6

VAT output

Answer 6

VAT output is the VAT collected by the business on the sale of all goods and services (which needs to be paid over to SARS)