Here's how to claim input tax back on your staff's flu jabs!
It's not just your health and safety officer who needs to pay attention when there's a medical expense or emergency in the office.
Winter is flu season and Star Consulting didn't want its 500 staff members to spend time off sick. So it hired a mobile clinic to come to the office and give its staff flu injections.
The clinic charged R50 per injection, so the total amount came to R25 000 including VAT.
Luckily Star Consulting's financial manager, Penny, knew she could claim the VAT on this expense back from SARS as input tax.
You can do it too! Let me show you how...
How to pay VAT with minimal losses for your business
The practical application of the VAT Act raises many issues that often result in disputes between taxpayers and the tax authorities. The purpose of our publication is to help you avoid mistakes in the practical application of the provisions of the VAT Act, and help you legally and knowledgeably defend your position in case of any disputes with SARS, including those arising during SARS audits.
The Practical VAT Handbook makes it possible for you to develop an optimal VAT strategy for your business without leaving your office.
It's not just a collection of comments and interpretations regarding VAT legislation. Rather, it is a day-to-day assistant in the operations of your accounts department and, ultimately, in organising your business.
Discover more here
How to get money back for office medical emergencies you've paid for
All you have to do to get money back for medical expenses in your business is to fill in the amount you're claiming on your VAT return for the period. It's easy to work out.
In the above example, the total for the flu injections came to R25 000. Penny simply multiplied this by the allowable tax fraction of 14/114 to reach the VAT amount of R3070.18. This is the amount she'll include in her input claim on Star Consulting's next VAT return.
Remember, Penny must also keep a tax invoice to make this claim!
Get your tax invoices right the first time!
Do you know:
Find out here
What a valid tax invoice looks like;
What information it must have; or
When you need a full tax invoice?
so SARS doesn't deny your input tax claim due to an invalid tax invoice…
If you paid for it, you can claim back the VAT portion of your staff's anti-retroviral medication!
This same principle applies to any medical expenses your staff incurs where you foot the bill!
For example, Rich Copper gold mine, purchases and pays R20 000 for anti-retroviral medication for its staff. The mine ensures it has a tax invoice from the supplier of the medication, applies the 14/114 tax fraction to the R20 000 and can claim the R2456.14 as input tax in the relevant VAT return.
All it takes is just one mistake for SARS to deny your input tax claim and slap you with penalties and interest!
With the Input Tax 101 eReport
, you'll be 100% sure of every input tax credit you can claim.
It's your complete guide to input tax, with information on:
Get your hands on your copy here
Nine items you can claim input tax on
10 Items you CAN claim input tax on, but didn't know about
Five exceptions to the rule against entertainment expenses
Eight Motor vehicles you can claim input tax on
And much, much more!
Claim VAT on the medical supplies in your first aid box!
You can also claim the VAT paid on the contents of the office's first aid box, (like plasters) as input tax, so go ahead and make the claim.
There you have it!
All you need to do is keep record of your staff's medical expenses like medication or doctor's visits you've paid for on their behalf and the tax invoices. Then you can claim back the VAT from SARS.
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