How does VAT works with game viewing?
SARS makes a VAT exception for vehicles you specifically design or alter to take people on game drives.
The charges to people going on game drives are subject to VAT at the standard rate because the purpose of this activity is to view game, and not necessarily to get from point A to Point B. After all, many game drives end up where they started from.
Now, because game drives are subject to VAT at the standard rate, it's only fair that game drivers can claim input tax on the vehicles they use for game drives.
So you can claim input tax on your vehicle purchases.
Read on to see the criteria to qualify for this VAT exception…
When can you claim VAT on game-viewing vehicles?
If you claim input tax, your SARS VAT audit is impending
And when the SARS auditor comes knocking or sends a query, he'll check if:
· Your books and records comply with the requirements of Section 55 of the VAT Act;
· You didn't claim on exempt supplies;
· Any of your claims were for non-taxable supplies;
· You apportioned inputs correctly and at the right tax rate (Sections 16, 17 and 20
of the VAT Act);
· And more!
But the truth is, even if you're entitled to your claim, but don't have the valid documentation, he'll still reverse your deduction!
Here's everything you need to secure every input tax claim you submit.
In order for game-viewing vehicles to be excluded from the general VAT rule for standard passenger transport, certain criteria must be met. They are that the vehicle must:
· Be used for game-viewing purpose only (or for where it's simply incidental and subordinate to its main use);
· Be permanently constructed or converted as a game-viewing vehicle;
· Seat 7 or more passengers;
· Be used in areas built or maintained exclusively for game-viewing, such as national parks, game reserves, sanctuaries, or safari areas; and that the vehicle
· May NOT be a station wagon minibus, double cab or other light-delivery vehicle in order to qualify.
.NOTE: You must register as a VAT vendor BEFORE you can enjoy the benefits of claiming input tax on your game-viewing vehicles.
*Do you want to learn more on VAT and game-viewing vehicles? Then page over to chapter G01: Game Viewing
in your Practical VAT Loose Leaf Service
handbook, otherwise click here
to get your hands on it today.
Also, book your seat for our VAT Master Class 2016