Page 416 - Juta's Indirect Tax

IN 49 (2) VALUE-ADDED TAX ACT: INTERPRETATION NOTES IN 49 (2)
E
Fixed property or real rights therein acquired under a taxable supply
[s 16(3)(a)(iiA)]
(a) Tax invoice1 and 5 a deed of sale containing the information as required in terms of section 20(4).
(b) Proof of payment.
F
Importation of goods [s 16(3)(a)(iii)]
(a) Customs Declaration or other document prescribed in terms of the Customs and Excise Act No. 91 of 1964.
(b) Proof that the VAT levied on goods imported into the
Republic of South Africa has been paid to SARS Customs (that is, by the vendor or that vendor’s agent).
G
Locally manufactured goods where the excise duty or environmental levy has not been included in the selling price
[s 16(3)(a)(iv)]
(a) Declaration Form (CD1).
(b) DA 75 Ad Valorem Excise Duty Form or DA 161A
Environmental Levy Account for Plastic Bags Form or DA 260 Excise Account Form or DA 176 Environmental Levy Account for Electricity or DA 177 Environmental Levy Account for Carbon Dioxide Emission Levy or DL 163 Diamond Export Levy Return.
(c) Proof that VAT has been paid to SARS Customs (e.g. receipt issued by SARS Customs).
H
Credit and debit notes [s 16(3)(a)(v)]
Copy of the credit note or debit note.5
I
Irrecoverable debts [s 16(3)(a)(v)]
(a) Accounting records re ecting the balance of the outstanding debt and amount of VAT written off.
(b) Proof that the VAT was charged and declared in a VAT return.
5.2 Input tax deduction in respect of vendors registered on the payments basis
A vendor accounting for VAT on the payments basis is entitled to deduct input tax on its purchases in the period during which payment for the purchases is made. The vendor making the deduction must be in possession of proof of payment (for example, a receipt, cash slip or bank statement) in order to qualify for a deduction of input tax. The deduction is, however, limited to the extent of any payment made. Furthermore, the vendor must hold a valid tax invoice at the time the input tax is deducted.
Table B provides an overview of the documentary proof to be obtained and retained by vendors that are registered on the payments basis in addition to the proof of payment made as well as references to the relevant sections of the VAT Act.
Table B – Applicable to a vendor registered on the payments basis
A
ITEM
DESCRIPTION OF SUPPLY
DOCUMENTARY PROOF REQUIRED
Goods or services acquired under a tax- able supply
[s 16(3)(b)(i)]
Second-hand goods (other than xed property) acquired under a non-taxable supply [s 16(3)(b)(i)]
Second-hand goods: Fixed property ac- quired under a non-taxable supply
[s 16(3)(b)(i)]
Tax invoice.5
Records as set out under section 16(3)(a)(ii)(aa) [see Table A
Item B].
A purchase or sale agreement which contains the following information:2
(a) The name of the supplier, and where –
(i) the supplier is a natural person, the supplier’s identity number must be recorded and veri ed with an identity document; or
(ii) the supplier is not a natural person –
the identity number of the natural person representing the supplier in respect of the supply must be recorded and veri ed with an identity document, and
the legally allocated registration number of the supplier (not the natural person) must be recorded and veri ed with the business letterhead or other similar document. Provided that the recipient must retain in the case of a – natural person, a copy of such identity document; and
a person other than a natural person, a copy of such business letterhead or other similar document.
(b) The address of the supplier.
(c) The date upon which the second-hand goods were
acquired.
408 Juta’s IndIrect tax 2016