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Did you know: All 16 of these goods and services are completely 'Vat free'!

by , 16 April 2014
Vat is a part of everyday life and it's something that we have to pay on everything. As a business, you also have to pay it on all the goods you buy. The good news is you can then claim Vat returns if you use these products to generate your income. But did you know that, according to SARS, there are 16 things that are 'Vat free' or charged zero-rate Vat? Keep reading to find out what they are...

Errors in Vat invoices could cost you thousands!
Are there any inaccuracies in your Vat invoices? You may be charged a very high penalty!
These goods and services are zero-rated for Vat
According to the Practical Vat Loose Leaf the 16 'Vat free' goods and services are:
1. Goods that are exported
2. The sale of an enterprise (this means part of a business)
3. The supply of gold to the SA Reserve Bank, South African Mint and registered banks
4. The supply of goods used for farming purposes
5. Petrol or distillate fuel oil which already have the fuel levy
6. The supply of goods to a branch or main business in an export country
7. Certain specific foodstuffs (basics such as bread, milk and fruit)
8. Gold coins supplied by the South African Mint (but not if it's used in jewellery)
9. The supply of kerosene for light sources
10. Supplies to industrial areas and developments
11. Conversion of old order mineral rights
12. Renewing of mineral rights
13. Foreign donor funded projects (where supplies are made to the foreign donor)
14. The sale of a business or company
15. Supply of certain imported goods that a vendor will sell in South Africa
16. Compensation given by a public authority when delivering a specific animal or thing
But here's the thing, even though these goods are zero-rated, you still have to follow the following protocol to prove it to SARS…
How much time do you spend looking for useful tax information? Do you need all the South African taxes analysed and explained in one easy location? 
Now you can have all the information you need in one place: The Practical Tax Loose Leaf Service.
You must prove to SARS that you have the right to charge at a zero-charge rate for Vat
PW Van Heerden Accountants say that you must keep all the right documents for any zero-rate Vat supplies. SARS will demand that you produce these documents or else you could face tax evasion charges. 
So ensure that you keep all of your invoices and records and check your numbers with a Vat calculator. And remember, everyone who's done their Vat registration must pay Vat. So make sure you're following SARS' Vat rules – whether for zero-rated goods or not. 

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