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If you don't have the right documents for these three zero-rated services, you'll spark a Vat audit

by , 24 October 2014
When it comes to taxable Vat supplies and services, SARS is very strict about the documents you need to support them.

Even when it comes to zero-rated services, SARS needs evidence of which services you didn't collect Vat on. This helps it ensure you pay over the correct amount of Vat.

That's why, today we're revealing three of these zero-rated services and the documents you need to support them on your Vat return...

 

If you offer these three zero-rated services, you must have these documents 

 
Zero-rate service #1: Services physically rendered in an export country 
- A copy of the zero-rated tax invoice.
- The recipient's order or the contract between you and the recipient; and
- Proof of payment.
 
Zero-rate service #2: Certain services supplied to nonresidents
- A copy of the zero-rated tax invoice;
- Recipient's order or the contract between you and the recipient; and 
- Proof of payment (including the Exchange Control declaration form from the South African Reserve Bank, if the consideration exceeds exchange limits).
 
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Zero-rate service #3: The international transport of goods or passengers
- A copy of the zero-rated tax invoice; 
- A copy of the transport contract, e.g. bill of lading, airway bill, post office receipt, railway consignment note, a road transport contract, etc. (This applies when you transport goods too. The transporter will give you the relevant form, e.g. if you send the goods by rail, the transporter will fill in a relevant railway consignment note);
 
- Proof of delivery. (Again, this applies where you transport goods too. Generally the transporter will issue the relevant form, e.g. a delivery note which must be signed by the recipient of the goods in the other country);
- Proof of payment, which the transporter of the goods must keep; and
- For passenger transport, a copy of the boarding pass.
 
For 17 details on the other zero-rated supplies and the documents you need for them, check out the Practical Vat Loose leaf Service.
 


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