Denied input tax deduction? This could lead to your deregistration as a Vat vendor
When it comes to input tax claims, do you know:
- The latest Vat law changes about the way you claim input tax?
- The 19 supplies you can claim input tax on for your business?
- Which supplies SARS specifically denies?
- When and how to claim input tax or notional input tax?
- How to work out input tax correctly on apportionment?
If you answered no to any of these questions, you risk claiming input tax when you shouldn't. And if SARS has many judgments against you, you could lose your Vat registration.
You see, when SARS catches you out at audit time – having claimed on something you shouldn't, it will reverse your input tax deductions, assess you, and add penalties and fines from the day you claimed.
It doesn't take this lightly. It simply sees this as if you're trying to de-fraud it.
So SARS will flag you for regular audits, and if it finds you keep claiming input tax when you shouldn't, it will continue to assess you.
But I warn you, one too many judgements from SARS will mean you could lose your Vat registration! SARS can, and will, deregister you, if it feels you're acting fraudulently.