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Seven things a SARS auditor will check when he audits your input tax

by , 27 August 2014
When SARS conducts a Vat audit, it'll put your input tax under the microscope.

The SARS auditor will audit your input tax to check the validity and accuracy of the information and documents. This'll give them a good indication of whether or not you've overstated your input tax.

It's important that you know the areas that SARS will check when doing the audit. This'll help ensure you have everything ready and that it's above board.

Here are the seven things a SARS auditor will check when he audits your input tax.


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A SARS auditor will check these seven things when he audits your input tax


According to the Practical Vat Loose Leaf Service, the SARS auditor will check that:

#1: Your books and records comply with the requirements of Section 55 of the Vat Act;

#2: You're registered on the invoice or payments basis and that your Vat returns are compiled accordingly;

#3: Your input claimed per your VAT201 returns is in agreement with inputs per your Vat control account;

#4: Journals are correctly posted from subsidiary books (purchases journal, payments cash book, etc.) to the Vat control account and that amounts have been posted at the correct rate of Vat (0% or 14%);

#5: Inputs comply with the requirements of a tax invoice, you apportioned inputs where applicable and that suppliers applied the correct tax rate;

#6: Inputs you claimed are reasonable and relevant in relation to the trade within which you operate; and

#7: Sundry items, such as discounts allowed, bad debts, accounting provisions and credit notes issued are correctly treated.

In addition to this, the auditor will ask you for a description of the accounting system you use and to confirm that it's functioning as described.

Now that you know the seven things a SARS auditor will check when he audits your input tax, have everything ready and make sure it's above board.

Ex-SARS auditor reveals: Five red-flags SARS looks for when doing a Vat audit



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