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Vat Act Revelation: Three things you should know about your VAT201 return

by , 17 October 2013
According to the Vat Act as a Vat vendor, you're required to submit your VAT201 return in accordance with the tax period allocated to you. To ensure you're always on the right side of the Vat Act, here are three things you should know about your VAT201 return.

According to SARS, the definition of Vat in the Vat Act is  'Vat is an indirect tax on the consumption of goods and services in the economy. Revenue is raised for government by requiring certain businesses to register and to charge Vat on the taxable supplies of goods and services. These businesses become vendors that act as the agent for government in collecting the Vat.'

It's for this reason that Vat returns are legal and binding documents that constitute a declaration made to SARS. It's also why failure to submit your Vat returns and pay the Vat due is a criminal offence.

But that's not all….

Follow these three points when dealing with your VAT201 return so you can avoid costly errors

#1: Your Vat return is a type of self-assessment form. You're solely responsible for determining the amount you have to pay, says the Practical Vat Loose Leaf Service.

#2: It's vital that you enter correct totals in the relevant income blocks (1, 1A, 2 and 2A) as SARS' e-Filing system automatically calculates the Vat you owe them.

#3: The VAT201 return is divided into two sections (sections A and B) and the relevant columns are also numbered (1 to 23) to assist you complete your return accurately.

Don't forget: If you qualify for the diesel refund scheme, then you'll have to complete section C as well.

The bottom line: When you complete your VAT201 return, know what you're doing and the consequences of errors or misrepresentations. Returns are legal and binding documents.

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