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Will SARS accept this as a tax invoice?

by , 05 May 2015
There are many situations when the question of whether SARS will accept a tax invoice or not may arise. In what follows, we'll look at two situations and answer this question for you. It's important to always know what your responsibilities are and what's the right procedure, together with SARS duties and limits as well.

Can you claim input tax on an invoice if it has a partial address and doesn't include the full name of company?

And,  if SARS does a Vat audit, will it reject these invoices?

Let's assume that the invoice you're claiming input tax is for less than R5 000.

In this case, the name, address and Vat number of the purchaser doesn't need to be on the tax invoice. But, all the other details do.

If however the invoice is for more than R5 000 then you need a full tax invoice. So, if you're claiming Vat on any tax invoice for expenses of more than R5 000 and the tax invoice doesn't contain all the information it needs to, SARS will disallow that deduction.

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Notional input tax can be confusing. And if you don't claim, you'll lose out on your input tax saving. But if you do claim without the required documents.. SARS will slap you with nasty fines and penalties.

To make sure you're compliant with all of SARS' Vat rules, I recommend the Practical Vat Loose Leaf. It will give you all the information you need to ensure you meet not just your notional input tax obligations but all your Vat obligations too.

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This makes your input tax less and may lead to you paying in more Vat. If this happens, you're penalised 10% on the additional payment portion that's required and interest per month, at the current interest rate. So, if you get an invalid tax invoice, email it back to the supplier and ask them to fix it and resend it to you

But what constitutes a legal tax invoice?

If a supplier reflects the Vat amount on an invoice, without showing the percentage of Vat, is it a legal tax invoice?

Note that the supplier will only have to show the percentage of Vat on the invoice if the invoice only has the Vat inclusive amount on it. Because either of the following information is required:

1. The value of the supply, the amount of Vat charged and the consideration for the supply (i.e. the amount charged including Vat); or

2. Where the amount of Vat is calculated by applying the tax fraction to the consideration, then the amount of the consideration (i.e. the amount charged including Vat) and either the amount of Vat charged, or a statement that it includes Vat and the rate at which the Vat was charged (Section 20(4)(g), Vat Act).

Keep this in mind when you deal with tax invoice and have to rely on SARS for a certain procedure.

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