Page 323 - Juta's Indirect Tax

IN 31 (3) VaLue-added tax act: InterPretatIOn nOtes IN 31 (3)
4. Application of the law
The provisions of section 11 (3), place an obligation on a vendor to obtain and retain documentary proof substantiating the vendor’s entitlement to apply the zero rate to a supply of goods or services in terms of sections 11 (1) and (2).
5. Documentary proof
The documentary proof that a vendor must be in possession of in order to substantiate the vendor’s entitlement to apply the zero rate to a supply of goods or services in terms of sections 11 (1) and (2), is set out in Tables A and B.
5.1 Supply of goods [section 11 (1)]
Table A below provides an overview of the documentary proof to be obtained and retained by a vendor in respect of a supply of goods in terms of section 11 (1), as well as references to the relevant sections of the VAT Act.
Table A – Vendors making a supply of goods in terms of section 11 (1)
ITEM
DESCRIPTION OF SUPPLY
DOCUMENTARY PROOF REQUIRED
A
Movable goods as a ‘direct export’ [s 11 (1) ((a) (i), read with paragraph ((a) of the de nition of ‘exported’ in
s 1 (1)]
Refer to paragraphs 5.1 and 6 of Interpretation Note No. 30 (Issue 2) dated 15 March 2006.*
B
Goods to a foreign-going ship or foreign- going aircraft
[s 11 (1) ((a) (i), read with paragraphs ((b) and ((c) of the de nition of ‘exported’ in s 1 (1)]
(a) The vendor’s copy of the zero-rated tax invoice;
(b) The foreign-going aircraft or foreign-going ship owner’s or
charterer’s order or contract with the vendor;
(c) Proof that the vendor delivered the goods to the aircraft or ship – i.e. a copy of the dispatch delivery order, with acknowledgement of receipt of the goods by the aircraft’s pilot, ship’s captain or a responsible person appointed by
the captain or pilot;
(d) Proof of export; and
(e) Proof of payment.
C
Movable goods as an ‘indirect export’
[s 11 (1) ((a) (ii), read with paragraph (d) of the de nition of ‘exported’ in s 1 (1)]
Refer to Part Two of the Scheme.†
D
Goods forming part of a repair service supplied in respect of goods temporarily admitted into the Republic of South Africa (the Republi(c) from an export country [s 11 (1) ((b)] (see also s 11 (2) (g) (ii))
(a) The vendor’s copy of the zero-rated tax invoice;
(b) A copy of the South African Revenue Service (SARS)
Customs Declaration evidencing the temporary import;
(c) The corresponding release noti cation; and
(d) Proof of payment.
E
Movable goods used exclusively in an export country or in a customs controlled area (CC(a) of an industrial development zone (IDZ) [s 11 (1) ((c)]
(a) The vendor’s copy of the zero-rated tax invoice;
(b) A copy of the contract between the lessee or other person
and the vendor;
(c) Proof of payment; and
(d) In the case of use in an export country:
Proof of export from South Africa or proof that the movable goods are situated outside the Republic at the time of supply; or
(e) In the case of use in a CCA of an IDZ:
The original VAT267 form endorsed by an IDZ operator when the goods entered the CCA.
F
Movable goods used exclusively in a business conducted in an export country [s 11 (1) (d)]
(a) The vendor’s copy of the zero-rated tax invoice;
(b) A copy of the contract between the lessee or other person
and the vendor;
(c) Proof of payment, which must also evidence that the rent
or other consideration was effected from the export country where the business operates or trades.
* This includes any future updates.
† The VAT Export Incentive Scheme, published as Notice 2761 of 1998 in Government Gazette No. 19471 of 13 November 1998.
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