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The only 18 goods you can zero-rate

by , 06 June 2014
You must either charge Vat on taxable supplies at 14% or 0%. But did you know the zero-rate only applies to certain supplies? The Vat Act is very specific about what these supplies are.

Let's take a look at the only 18 goods you can charge Vat at the zero-rate on.

The only 18  goods you can charge Vat at the zero-rate on:
  1. Direct and indirect exports: (interpretation note 30 on SARS' website);
  2. Going concerns;
  3. Gold;
  4. Agricultural goods;
  5. Fuel levy goods: Petrol and diesel;
  6. Foreign branches;
  7. Certain foodstuffs;
  8. Gold coins;
  9. Illuminating kerosene; and
  10. To a custom controlled area.

Keep reading for eight more goods you can charge Vat at the zero-rate on...

***
Putting a zero in the wrong place on the new Vat Return could cost you your refund!

Click here to find out how to make sure this never happens to you by getting your Vat return right every single time

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Eight more goods you can charge Vat at the zero-rate on

  1. Mineral rights: Permission from the Department of Mineral Resources to mine minerals;
  2. Going concern to a branch;
  3. Triangular supplies: where a non-resident (A) contracts with a South African customer (B) for the supply of goods or services, and (A) subcontracts certain components of the transaction to a South African contractor (C));
  4. Compensation in terms of Animal Diseases Act;
  5. Fixed property supplied to the Minister of Land Affairs in terms of the Provision of Land and Assistance Act or Restitution of Land Rights Act (land claims);
  6. Fixed property supplied to a person if you pay in advance for the land or you receive a subsidy in terms of the Provision of Land and Assistance Act;
  7. Goods imported and stored in bond and not entered for home consumption and sold to a foreign supplier; and
  8. Sold from an inbound duty and tax free shop.

But remember, there are also services and food items   you can charge Vat at the zero-rate. For the full list of zero-rated supplies, as well as how to charge this Vat rate correctly, turn to chapter Z01: Zero-rated supplies in your Practical Vat Loose Leaf. Don't have one? Click here.


P.S: Here are 13 secrets that will give you insider information on how to red-flag potential Vat risk areas, before the SARS team does.


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