Page 411 - Juta's Indirect Tax

IN 42 VaLue-added tax act: InterPretatIOn nOtes IN 42
document must be in the currency of the Republic and contain the details prescribed in section 20 of the VAT Act. These details will vary depending on the consideration for the taxable supply.
6.1 Consideration for the supply exceeds R50 but not R3 000
If the consideration for the supply exceeds R50, but not R3 000, the document must contain the following particulars before it will constitute a valid tax invoice (referred to as an ‘abridged tax invoice’):
• The words ‘tax invoice’ displayed in a prominent place.
• The name, address and VAT registration number of the supplier.
• An individual serialized number and the date on which the tax invoice is issued.
• A full and proper description of the goods (indicating, where applicable, that the goods are second-hand goods) or
services supplied.
• With regard to the tax charged, either the value of the supply, the total amount of tax charged and the consideration
including tax charged for the supply; or the consideration including tax charged for the supply and either the amount of tax charged or a statement to the effect that it includes a charge for the tax and the rate at which the tax was charged.
• The value and consideration must be denominated in Rand (except in relation to a zero-rated supply).
6.2 Consideration for the supply exceeds R3 000
If the consideration for the supply exceeds R3 000, the document must contain the following particulars before it will constitute a valid tax invoice (referred to as a ‘full tax invoice’):
• The words ‘tax invoice’ displayed in a prominent place.
• The name, address and VAT registration number of the supplier.
• The name, address and VAT registration number of the recipient.
• An individual serialised number and the date on which the tax invoice is issued.
• A full and proper description of the goods (indicating, where applicable, that the goods are second-hand goods) or
services supplied.
• The quantity or volume of the goods or services supplied.
• With regard to the tax charged, either the value of the supply, the total amount of tax charged and the consideration
including tax charged for the supply; or the consideration including tax charged for the supply and either the amount of tax charged or a statement to the effect that it includes a charge for the tax and the rate at which the tax was charged.
• The value and consideration must be denominated in Rand (except in relation to a zero-rated supply).
Importantly, while the general requirement is that the tax invoice must be in the currency of the Republic, this is not necessary where the supply is subject to tax at the zero rate (proviso to section 20 (4) of the Act).
6.3 Agents
The VAT Act makes provision for an agent, being a vendor, who makes a taxable supply on behalf of a principal, to issue a tax invoice on behalf of that principal. However, in this instance the principal will not be entitled to issue a tax invoice. This would however, not preclude the principal from accounting for output tax on that transaction in its VAT201 return. The agent in issuing the tax invoice on behalf of the principal is required in terms of the VAT Act to maintain suf cient records to ascertain the name, address and VAT registration number of the principal. In addition, the agent must notify the principal in writing within 21 days of the end of the calendar month during which the supplies were made, the particulars of—
• full and proper description of the goods (indicating, where applicable, that the goods are second-hand goods) or
services supplied;
• the quantity or volume of the goods or services supplied;
• either—
– the value of the supply, the amount of tax charged and the consideration for the supply; or
– where the amount of tax charged is calculated by applying the tax fraction to the consideration, the consideration for the supply and either the amount of the tax charged, or a statement that it includes a charge in respect of the tax and the rate at which the tax was charged:
6.4 General
Vendors that nd it impractical to issue a full tax invoice (as set out in paragraph 6.1 and 6.2), must apply to SARS in order to obtain approval to deviate from the relevant provisions. In this regard, it must be noted that this application will only be considered by SARS if the vendor can satisfy the Commissioner of SARS that there are or will be suf cient records available to establish the particulars of any supply or category of supplies, and that it would be impractical to require that a full tax invoice be issued in terms of section 20 of the VAT Act. In addition, SARS might introduce certain conditions that it might deem necessary.
Juta’s IndIrect tax 2016 403