The Complete Guide to Zero-Rated Vat: 46 supplies you can zero rate and the documents you must keep to validate them
Let's face it. Zero-rated Vat is complicated!
Take Master Currency for example. They charged Vat at the zero rate because they operated out of the duty free zone in the airport. Sounds correct, right?
And what about De Beers Consolidated Mines? They imported services from London and expected it to be zero-rated, right?
In both cases, SARS demanded their output tax. This came in excess of R7 million for De Beers alone!
You see, when you charge Vat at the zero rate, you must prove to SARS you're entitled to do so! Because when SARS audits you (not 'if', 'when'), and you don't have proof, it will charge you penalties and interest. And it will deem the amount to include Vat and expect the 14% from you!
But don't be caught unawares.
Find out which items can be zero-rated and how to do it correctly. And what documents you need to keep on hand so SARS doesn't raise an assessment against you.
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