Section 1 of the Vat Act specifically includes partnerships in the definition of a person.
This means the Vat Act treats partnerships as 'persons'.
The Vat Act makes an exception for partnerships in that it allows a partnership to apply to be registered as a vendor, despite the fact that a partnership isn't a legal person.
This is because the Vat Act requires every 'person' who carries on an enterprise, in which the total value of all taxable supplies made by that person exceeds or will exceed R1 million in any 12-month period to register as a Vat vendor.
Although the partnership is seen as a vendor for Vat purposes, the individual partners are jointly and severally liable for the vendor's duties under the Vat Act, including the payment of Vat due to SARS
So if you belong to a partnership, you and the other partners for your partnerships' are liable for your Vat obligations until you decide to terminate your partnership.
Basically, the partnership must register as a Vat vendor (if it qualifies for registration) and will be liable for its Vat. The individual partners are jointly and severally liable for the partnership's Vat.
Now that you know how the Vat Act treats partnerships, make sure you comply.
Enjoyed this article? Subscribe to receive these free articles in your inbox daily.