Bought second-hand goods for less than R1 000? Do this one thing so you don't lose out on input tax
You can claim input tax (notional input tax) on second-hand goods.
But SARS will only let you claim if you stick to its requirements.
For the purposes of this article, we'll discuss the requirements for buying second-hand goods for less than R1 000. There's a lot of confusion about these requirements. And it often leads to Vat vendors losing out on valuable claims.
To avoid losing out as well, keep reading to discover the one thing you must do when you buy second-hand goods for less than R1 000.
There's one thing you must do when you buy second-hand goods for less than R1 000
According to the Input Tax 101 e-Report,
when you buy second-hand goods
for less than R1 000, you MUST keep a written record about the sale. This record must include:
The name, address and ID number of the supplier/seller (if it's a company, then get the details of a representative person);
The quantity or volume of the goods;
An accurate description of the goods;
A declaration by the supplier that the supply isn't a taxable supply; and
The price charged or paid for the goods.
Introducing your Input Tax 101 e-Report
*********** Advertisement ************
Increase your cash flow, minimise your Vat bill and get your Vat refund quicker by becoming an instant input tax expert!
Just one of the checklists you'll find in the Input Tax 101 e-Report could save you R1 500 per month. That's R18 000 per year! And because you know all our information is 100% correct, you won't worry about facing a Vat audit or be liable for thousands of rands in additional penalties.
Here's how to save…
Is there an easy way to record all this information and make sure you don't leave anything out?
Use the official VAT264 form.
It includes a declaration by the owner of the goods and ensures the record is complete. This way, you can claim your notional input tax on the transaction with ease and not lose out.
Knowing what to do when you buy second-hand goods for less than R1 000 will help you make sure you never lose out on input tax.
PS: The requirements are different when you buy second-hand goods for R1 000 or more. For this, we recommend you check out Input Tax 101 e-Report
so you can also claim input tax on them too.