Page 430 - Juta's Indirect Tax

IN 52 (3) VaLue-added tax act: InterPretatIOn nOtes IN 52 (3)
June 2012
July 2012
August 2012
October 2012
December 2012
Question:
Can Vendor C, instead of ending its tax periods on the last day of each month, end its tax periods on the dates set out above?
Result:
Yes, Vendor C’s cut-off dates fall within the categories for which approval is granted by the Commissioner as set out in 5.1. Furthermore, Vendor C may only apply the new cut-off dates from a future tax period and must ensure that it satis es the conditions set out in 5.2.
27 June 2012
25 July 2012
29 August 2012
September 2012
26 September 2012
31 October 2012
November 2012
28 November 2012
21 December 2012
January 2013
29 January 2013
February 2013
28 February 2013
Example 3 – Vendor’s month-end reporting ends on a xed day
Scenario:
Vendor B is a VAT-registered vendor and is required to submit VAT 201 returns on a monthly basis as contemplated in section 27(1). Vendor B ends its month-end reporting on the last Wednesday of each month for the purpose of compiling its management reports.
Question:
Can Vendor B, instead of ending its tax periods on the last day of every month, end its future tax periods on the last Wednesday of every month?
Result:
Yes, Vendor B’s cut-off dates fall within the categories for which approval is granted by the Commissioner as set out in 5.1. Furthermore, Vendor B must ensure that it satis es the conditions set out in 5.2.
Example 4 – Vendor’s elected month-end cut-off date has been used for less than 12 months and Vendor requests to change to another xed day
Scenario:
Vendor D is a VAT-registered vendor and is required to submit VAT 201 returns on a monthly basis as contemplated in section 27(1). Vendor D has been ending its monthly tax period on a xed day, being the 5th day of the calendar month, for the last 7 months from January to July.
The shareholding in Vendor D has recently changed and its new majority shareholder, Company X, wants the cut- off dates of Vendor D to align with its own for management reporting purposes. Company X is also a VAT-registered vendor and ends its tax periods on the 25th day of each calendar month.
Question:
Can Vendor D, instead of ending its tax periods on the 5th day of the calendar month, end its future tax periods on the 25th day of each calendar month?
Result:
No, while both Vendor D and Company X’s cut-off dates fall within the categories for which approval is granted by the Commissioner as set out in 5.1, Vendor D has not used its elected cut-off dates for a minimum period of 12 months as prescribed in proviso (ii) to section 27(6). Vendor D is required to end its tax periods on the 5th day of the calendar month for an additional 5 months after which it may elect to end its tax periods on the 25th day of each calendar month.
Example 5 – Vendor is changing cut-off dates and is uncertain about when subsequent tax period begins
Scenario:
Following on from the scenario in Example 4, Vendor D carries on ending its tax periods on the 5th day of the calendar month for an additional period of 5 months from August to December, thus satisfying proviso (ii) to section 27(6). Vendor D’s cut-off date in December is the 5th day of January. This complies with the 10-day rule. From its January tax period it will change its cut-off dates to the xed day of the 25th day of each month to align itself with Company X’s tax periods.
422 Juta’s IndIrect tax 2016