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.
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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.