There are certain services you supply to nonresidents that are zero-rated
To avoid the mistake Master Currency made
, let's take a look at 14 services you can zero rate (Section 11(2) of the Vat
Here are the 14 services you can zero rate!
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Are there any inaccuracies in your Vat
invoices? You may be charged a very high penalty!
If SARS finds inaccuracies, you'll be assessed, held liable to penalties, interest and possibly even additional tax
Click here to find out how to make sure your Vat invoices are 100% legal.
You can zero rate the following services:
1. Services physically rendered in an export country;
2. Certain services you supply to non-residents;
3. The international transport of goods or passengers;
4. Services connected with the transport of goods within South Africa;
5. Insuring or the arranging of the insurance or the arranging of the international transportation of passengers or goods;
6. Services you supply directly in connection with land or improvements to land in an export country;
7. Services relating to movable goods situated in an export country, but temporarily imported into South Africa;
8. Services you supply to non-residents and nonvendors in connection with repair, maintenance, cleaning or re-conditioning foreign going ships or aircraft and containers;
9. Services you supply to non-residents and nonvendors in connection with handling, pilotage, salvage, towing, operating or managing foreigngoing ships or aircraft and storage, repair,
maintenance, cleaning or providing of containers;
10. Arrangement of certain activities for non-residents;
11. Repairs to trains operated by non-residents;
12. Services you supply to a branch or main business situated in an export country;
13. Services relating to goods under warranty where you provide services to a non-resident warrantor who's outside South Africa at the time the services are rendered;
14. Vocational training of employees where the employer is non-resident and not a vendor;
Keep in mind this! Make sure you have all your documentary proof of the zero rating and that it's 100% correct.
What are the penalties you can get for getting the zero rating wrong?
If you don't have your documents correct, SARS will see the zero-rated invoice as a standard-rated one and will deem the amount to include Vat
at 14%. So you'll have to pay the output tax
over to SARS on the amounts you received.
Moreover, SARS will charge you additional penalties and interest. So you'll end up losing money, as you're out of pocket by the 14% Vat
you must now pay extra.