Changes to tax law you WON'T hear about in the news...
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In the coming months the tax
law will undergo a number of significant changes.
The majority of these will affect the duties of tax
professionals and, in particular, their liability for offences committed under their watch.
But you won't hear about these changes on the six o'clock news.
I doubt they'll even get a mention in the national press.
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The new change is…
Section 11 of the VAT Act has changed. The Transporter's business activity MAY INCLUDE transport of goods. So now, you can use any company to transport goods to your clients in a Customs Controlled Area or an IDZ, as long as the activities of that company 'includes transport'.
Let's look at an example to break this down…
Waldo's Watch Warehouse, based in Midrand, sells watches to a client at Coega, which is in a Customs Controlled Area. Waldo applies the zero rate of VAT to the invoice and appoints 'Calvin's Carpets and Transporters' to transport the watches to Coega.
The VAT Implication:
Before 1 April 2016, Waldo wouldn't have been able to apply the zero rate of VAT as his transporter's business activities were both carpeting and transporting.
After 1 April 2016, Waldo can now apply the zero rate of VAT because Calvin's business activities include transport.
Read on to find out how you can make VAT on exports easy…
Some enterprises still aren't registering for VAT. Are you one of them?
Are you running a business? Or even starting a new one? SARS changed the definition of an enterprise a while ago. And while this may be old news to you, some companies still aren't registering for VAT.
If you're liable to register for VAT and don't – you're guilty of a criminal offence. You may even go to prison. And the penalties and interest you would have to pay on your late VAT returns are harsh.
to avoid this!
Make VAT on exports easy
Get your copy of the Practical VAT Loose Leaf, where we show you:
Until next time,
How to make sure you classify your exports correctly else SARS force you to pay output tax and charge you with penalties and interest
6 Documents you have to keep to apply the right VAT rate to direct exports
How long you must keep supporting documents for
3 Tips to deal with direct exports
3 Tips to deal with indirect exports
By Natalie Cousens,
Managing Editor: The Practical VAT Loose Leaf
P.S. If you're not yet a subscriber, your Practical VAT Loose Leaf gives you a complete 30-day review period, so you risk absolutely nothing. Study it at your leisure for a full month after you receive it. If you are not entirely satisfied that this unique publication will keep you out of the taxman's clutches, just return your copy for a full, no-questions-asked refund.