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Four rules your need to know about Vat refunds

by , 07 August 2014
Vat refunds are great as they boost your company's cash flow. In this tough economy every little bit of cash is welcome.

But, getting a Vat refund isn't that simple.

You have to play by the rules if you want to get your Vat refund on time and without any problems.

Here are the four rules we believe every Vat vendor needs to know about Vat refunds.


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Four rules your need to know about Vat refunds


The Practical Vat Loose Leaf Service gives you the four ground rules you need to keep in mind to claim back a Vat refund:

Rule #1: If your input tax exceeds your output tax, you're entitled to a refund.

Rule #2: If your output tax exceeds your input tax, the difference shows the Vat liability you'll have to pay over to SARS.

Rule #3: You can't off-set a refund for one tax period against Vat payable for another tax period – but SARS can!

Rule #4: You must have documented proof for every item you claim input tax for. If you can't prove it, or if your records are incomplete or invalid, don't even attempt the claim!

In this article, our experts explain that in terms of Section 45 of the Vat Act, SARS can suspend your payment and any interest on it, if you can't verify the Vat refund when it asks you to do so.

Also keep in mind that SARS conducts periodic audits to verify claims and you'll pay a fixed penalty if you try and evade or postpone paying tax.

There you have it. We hope these rules will help you get your Vat refunds without any problems.

If you want more information on Vat refunds, the Practical Vat Loose Leaf Service is your best bet.




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