Page 384 - Juta's Indirect Tax

IN 40 (2) VaLue-added tax act: InterPretatIOn nOtes IN 40 (2)
VAT implications for the Supplying Vendor
The Supplying Vendor must zero rate the supply in terms of s 11(1)(m) where the Supplying Vendor/Supplying Vendor’s cartage contractor delivers the movable goods to a CCAE/IDZ Operator in a CCA.
VAT implications for the CCAE or the IDZ Operator
There are no VAT implications for the CCAE/IDZ Operator as VAT is levied at the zero-rate, unless the CCAE/IDZ Operator acquires goods for the purposes of which a deduction of input tax would have been denied in terms of s 17(2), or the goods are not wholly for consumption, use or supply in the course of making taxable supplies. In this instance, the goods are deemed to be supplied by the CCAE/IDZ Operator in terms of s 18(10). The output tax adjustment must be made in the same tax period in which the goods were acquired. See para 6.
Documentation to be available for VAT purposes for submission to the IDZ Operator at the time the goods enter the CCA:
• The Supplying Vendor must issue a tax invoice and levy VAT at the zero rate.
• The Supplying Vendor must issue a delivery note or other document indicating that VAT was levied at the zero rate in
order to facilitate the entry of the goods into the CCA where a tax invoice is not issued at the time the goods enter the
CCA.
• The Supplying Vendor/Supplying Vendor’s cartage contractor must complete a VAT267 form.
• The Supplying Vendor must obtain and retain the documentary proof required in terms of s 11(3), read with IN31. 5.14 Supply of movable goods by a Supplying Vendor to a CCAE/IDZ Operator in terms of a rental agreement,
charter party or agreement for chartering and such goods are used exclusively in a CCA
Customs treatment
No Customs treatment. Movement of goods in free circulation.
VAT Implications for the Supplying Vendor
The Supplying Vendor must levy VAT at the zero rate in terms of s 11(1)(c) on the supply of the movable goods.
It is important to note that s 11(1)(c) excludes the supply of a ‘motor car’ as de ned in s 1. The supply of a ‘motor car’
to a CCAE/IDZ Operator is therefore always subject to VAT at the standard rate in terms of s 7(1)(a).
VAT implications for the CCAE/IDZ Operator
There are no VAT implications for the CCAE/IDZ Operator as VAT is levied at the zero-rate, unless the CCAE/IDZ
Operator acquires goods for the purposes of which a deduction of input tax would have been denied in terms of s 17(2) or the goods are not wholly for consumption, use or supply in the course of making taxable supplies. In this instance, the goods are deemed to be supplied by the CCAE/IDZ Operator in terms of s 18(10). The output tax adjustment must be made in the same tax period in which the goods were acquired. See para 6.
Documentation to be available for VAT purposes for submission to the IDZ Operator at the time the goods enter the CCA:
• The Supplying Vendor must issue a tax invoice to the CCAE/IDZ Operator and levy VAT at the zero rate.
• The Supplying Vendor must issue a delivery note or other document indicating that VAT was levied at the zero rate in order to facilitate the entry of the goods into the CCA where a tax invoice is not issued at the time the goods enter the
CCA.
• The Supplying Vendor, the CCAE or the IDZ Operator must complete a VAT267 form.
• The Supplying Vendor must obtain and retain the documentary proof required in terms of s 11(3), read with IN31
where the zero rate is applied.
5.15 Supply of services that are physically rendered in a CCA by a Supplying Vendor to a CCAE/ IDZ Operator
Customs treatment
No Customs treatment. Services are being supplied.
VAT implications for the Supplying Vendor
The supply is subject to VAT at the zero rate in terms of s 11(2)(k) where the Supplying Vendor physically renders the services in a CCA.
VAT implications for the CCAE/IDZ Operator
There are no VAT implications for the CCAE/IDZ Operator as VAT is levied at the zero-rate, unless the CCAE/IDZ Operator acquires the services for the purposes of which a deduction of input tax would have been denied in terms of s 17(2) or the services are not wholly for consumption, use or supply in the course of making taxable supplies. In this instance, the services are deemed to be supplied by the CCAE/IDZ Operator in terms of s 18(10). The output tax adjustment must be made in the same tax period in which the goods were acquired. See para 6.
Documentation to be available for VAT purposes for submission to the IDZ Operator at the time the Supplying Vendor enters the CCA:
• The Supplying Vendor must produce a job card or an order, together with an inventory of the movable goods and
equipment which enters the CCA for purposes of performing the relevant services.
• The Supplying Vendor must complete a VAT267 form.
• The Supplying Vendor must issue a tax invoice and levy VAT at the zero rate.
• The Supplying Vendor must obtain and retain the documentary proof required in terms of s 11(3), read with IN31. 5.16 Movable goods originally supplied in terms of a rental agreement, charter agreement or agreement for
charter that are subsequently returned by a CCAE to the Supplying Vendor
Customs treatment
No Customs treatment. Movement of goods in free circulation.
VAT implications for the Supplying Vendor
There are no VAT implications.
VAT implications for the CCAE
There are no VAT implications.
Documentation to be available for VAT purposes for submission to the IDZ Operator at the time the goods exit the CCA:
376 Juta’s IndIrect tax 2016