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Should you register for Vat as a foreigner?

by , 27 March 2015
When it comes to your liability for Vat registration, what do you do if you're not a South African resident?

To explain that let's take the example of a Namibian resident with a business in South Africa and find out if he has to register his business for Vat.

To register or not: Is Vat registration essential for foreigners?


Your foreign company doesn't need to have a permanent establishment or physical presence in South Africa to be liable for Vat registration.

In other words, if you're a non-resident company and supply goods or services in South Africa, you must register for Vat if your supplies exceed R1 million in any 12-month period, or you expect it to exceed R1 million in the next 12 months.

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Keep in mind that if you don't register, your company's in breach of Section 1 and Section 23 of the Vat Act and you'll be liable for penalties and fines in terms of the Tax Administration Act.

Moreover, according to the definition of 'enterprise' in Section 1 of the Vat Act, an enterprise includes any activity carried out in South Africa, or partly in South Africa.


Your foreign company doesn't need to have a permanent establishment or physical presence in South Africa to be liable for Vat registration; it just needs to carry out an enterprise. And, if its turnover from this South African enterprise is more than R1 million, it's compulsory to register.

On a final note, keep in mind that since the facts and implications of each venture may differ, it's very important to find out if the transactions your company enters into could give rise to a Vat registration liability.

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