How to register for VAT with SARS in South Africa
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- Опубліковано 26 сер 2024
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And now for the video script... :)
Over the past few years SARS has tightened up a lot on all VAT registrations owing to the amount of fraud committed involving false VAT claims. I have personally been called as an expert witness for the prosecution in a SARS VAT fraud case. In this video I am going to explain when you need to register for VAT and how we can help you.
Just to be clear, it is only compulsory to register for VAT once your turnover has breached R1m in any 12 month consecutive period. You can however also voluntarily register for VAT but only if you have sales of more than R50,000. For the voluntary VAT registration, a minimum of three invoices which total more than R50,000 are required and these amounts must be reflected in your business bank account.
SARS regularly changes the requirements for VAT registrations, for example they use to accept a contract as a proof of turnover for registration purposes, then they disallowed it for a while only to reintroduce it again recently. However SARS does not accept cashflow projections or quotes as proof of turnover.
Aside from the standard company information a VAT registration will need a letter of appointment signed by all the directors appointing one of the directors as the public officer of the company. The public officer is effectively the representative of the company as all actions carried out by the public officer are deemed to have been done by the company. Additionally, a letter of acceptance signed by the newly appointed Public officer is required as well as a standard FICA proof of address, such as a municipal account.
SARS will also require your company banking information in the form of an original confirmation letter from your bank and the latest original banking statements as well as proof of address for the company. If the company is a tenant a form CRA01 needs to be signed by the owner of the property and the property owner needs to provide of address.
If you live in the greater Cape Town area you will be required to attend an interview at the SARS head office in Cape Town. We will schedule the appointment and accompany you to the meeting. This is a further measure the SARS has recently instituted in their quest to stamp out fraud. However if you reside outside the greater Cape Town we required a Power of Attorney signed by you instructing our tax practitioner (the MST group) to represent you at SARS.
Please remember that all your other taxes such as company tax, PAYE and all the directors personal income tax must be up to date or SARS will not process the application.
So how do you apply for your VAT registration? Just log on to our site and request the one page application form which will automatically be emailed to you. Complete it, compile the supporting documents and return it to us. SARS insist that all supporting documents must be original so you will need to either courier them to us or drop them off at our office should you be in the area. If everything is in order and your other taxes are all up to date the entire process should take between 1-2 weeks.
It really is that simple so give it a try, but if you get stuck please call our friendly call centre as they will gladly assist you
I hope this has been helpful so as always remember, WE ARE HERE TO HELP
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Thank you so much
You're most welcome
Hi, great video, always very informative. How much would a Vat. registration cost?
Hi Teresa we charge R1990 for VAT registrations. Just be aware that SARS has recently made the appointment of the public officer of the company a compulsory requirement before any new tax applications can commence. If your company's public officer has already been appointed then you are good to go.
Thank you for this video. I have been searching for something like this for a while. I have a company and not registered for VAT. I intended on buying an equipment which is worth R750 000 including VAT. I have secured a job to supply services and the company will make a turnover of R48 600 per month excluding VAT. If I were to register for VAT the turnover would then be R48 600 *1.15 = R55 890. I also would like to claim the VAT on the Capital expenditure on the Equipment. Should I go ahead register for VAT based on this scenario? Thank you.
Yes, I would agree with you the VAT claim on R750k would be substantial. Just ensure you qualify with the SARS requirements eg. A bank account in the name of the business and invoices plus the payments of over R50k into your bank account. Should you wish to proceed plesse use the following link. www.swiftreg.co.za/swiftreg/products/vat-registration.aspx
I was looking for step by step of how to register as the title says
Hi there, you should be able to find a guide on the SARS website.
Thanks for informative video . I have a customer who insist that I must have vat 103 . And I have never made over R50K since my company registered. What must I do in this setuation ?
Hi Thabo, it sounds like your customer does not understand the implications nor the registration requirements of VAT. Your business currently does not meet the requirements to register for VAT so even if you wanted to you would not be able to register for VAT. I would try and explain to your customer that if you were registered for VAT your prices would be 15% more expensive than your current prices as you would need to add VAT to them. Good luck, I hope this helps
Informative, can you make a video on filling in tender documents
Thank you Clarah, yes I will. I have ten videos lined up and will add your recommendation to the list. I appreciate your feedback.
As a Forex trader i would fall under sole proprietor yes? What is the process to register my business with SARS?
Hi Marshelle, a Sole proprietor is an individual operating a business in their personal name, meaning they have not registered a company. I assume you have not registered a company. This being the case you must first register as an individual tax payer with SARS and only then and after you have met the requirements for VAT registration can you register for VAT in your personal name. I suggest you look at my video on the 9 benefits of registering a company. ua-cam.com/video/_CAYSrmUSjk/v-deo.html I hope I have answered your question.
is it necessary to do a letter of appointment of Public Officer if there is only one director in the company?
Hi Shimmer, yes it is compulsory even if there is only one director on the company. SARS will also not issue a Tax Clearance Certificate nor process any other registration, if a public officer is not appointed. It remains a separate registration.
Good day, I do branding so I buy clothing as a reseller my clients cant buy direct I pay the VAT on it my clients want to claim but I cant include VAT since Im not registered. Im not at the 50k mark just jet. What do you suggest?
Hi Anneke, there is unfortunately nothing you can do until you meet the minimum requirements to register for VAT. This means you have to pay the VAT to your suppliers but you can't charge VAT to your clients. However, if your clients are the general public who are not VAT registered then your prices should effectively be 15% cheaper than your VAT registered competitors.
Hy, I have been watching all of your videos for a while, very informative. I have been looking for a video like this for weeks now. So what if a business is just registered, should they worry about getting a VAT No. Or wait till they reach the R50 000 mark? And quotes, are they legally allowed to put "excl VAT" even if they do have a VAT No. Or you they must have a VAT No. to do so? Thank you.
Hi Anthony Thank you for watching our channel, there are plenty more videos on their way. Let me try and answer your question. Firstly, you can't change VAT if you are not VAT registered. This is seen as fraud. Remember VAT is not your money, you are only collecting it for SARS. You will have to wait until you get to a minimum of R50,000 turnover in a three month period and then register for VAT.
Some customer insist that you should be VAT registered in order to deal with them. This is so wrong as they don't understand how VAT works. Let me give you an example. Lets assume you and me both sell the same tin of paint to the same company for R100. You are VAT registered and I am not. You would have to add VAT and sell the paint for R115 while I can sell it to them for R100 and we still make the same profit. This is because you have to pay the VAT over to SARS.
If the company is VAT registered they can claim your VAT back but not on my tin of paint as I am could not change VAT. This makes the transactions effective the same if the company is VAT registered. Therefore there is no benefit for them to insist that you become VAT registered. On the other hand if the company is not VAT registered I will be 15% cheaper than you.
I hope this helps.
@@swiftreg thank you. It helps. 👍
Hi. I need some advice. I have a small PTY LTD business (Not Vat Registered). I receive payments through PayPal throughout the year and when it adds up it comes down to around R200 000 for the year.
PayPal usually only deduct their fees, but from the 1st of Jan 2024, they will start collecting Vat for the South African government.
Do I have to register for Vat if there’s a deduction for example of R6000 for each payment received.
Should I consider registering for Vat? Is there any way i can claim that money back or does it now belong to SARS.
What benefit will there be for me if I register for Vat?
My income will from 1st of Jan 2024 be much less due to the Vat Deductions.
Your feedback would be very much appreciated.
My honest advice is to not register for VAT unless you have to. The reason for this is that you become a glorified tax collector with a lot more administration and responsibility. Remember if you register for VAT your prices should increase by 15% which may make them uncompetitive.
@@swiftreg Thank you very much for your advice, I just subscribed to your channel.
Very informative. Thanks
Glad it was helpful!
As a Customs Clearing Agent clients normally pay Customs Vat & duty and all other related charges to the Importing of consignment into my account which is greater than 50K Customs Vat or should Vat be 50k on my service fee?
Hi Mitchell, It is my understanding that you are paying the SARS duties on behalf or your clients. This would mean that the clients VAT due to SARS is separate to your service fee. You will only be able to add VAT to your service fee and not the full invoice and only if you are a registered VAT vendor. I would confirm this with your accountant or directly with SARS.
@@swiftreg thank you for your speedy response... okay so that Vat I charge on my service fee must amount to 50k in order to get a Vat number...
Hi Mitchell, you can only charge VAT if you are already VAT registered. meaning , you can't charge VAT if you don't have a VAT number. To get a VAT number you need to have at least three invoices that add up to R50k and has to appear on your bank account with the companies name.
@@swiftreg I'm new to this and I registered my business with you guys May 2020 so the invoices doesn't necessarily need to be vat that adds up to R50k I have 3 invoices that adds up to just over R300k will I be able to get Vat number?
Hi Mitchell, you must separate the clients funds including the duties from your service fee on the invoice. If your service fee (meaning only that portion of the invoices) adds up to more than R50k then yes you are eligible to register for VAT. Only when you are registered for VAT can you charge VAT. If you charge VAT without being registered it is considered fraud.