Page 496 - Juta's Indirect Tax

IN 83 (2) VaLue-added tax act: InterPretatIOn nOtes IN 84
(vi) a brief explanation of the circumstances giving rise to the issuing of the credit note;
(vii) information suf cient to identify the transaction to which the credit note refers;
(b) the actual tax charged in respect of the supply concerned exceeds the tax shown in the tax invoice as charged, the
supplier shall provide the recipient with a debit note, containing the following particulars: (i) The words ‘debit note’ in a prominent place;
(ii) the name, address and VAT registration number of the vendor;
(iii) the name, address and, where the recipient is a registered vendor, the VAT registration number of the recipient, except where the debit note relates to a supply of goods in respect of which a tax invoice contemplated in section 20(5) was issued;
(iv) the date on which the debit note was issued; (v) either—
(aa) the amount by which the value of the said supply shown on the tax invoice has been increased and the amount of the additional tax; or
(bb) where the tax charged in respect of the supply is calculated by applying the tax fraction to the consideration, the amount by which the consideration has been increased and either the amount of the additional tax or a statement that the increase includes an amount of tax and the rate of the tax included;
(vi) a brief explanation of the circumstances giving rise to the issuing of the debit note;
(vii) information suf cient to identify the transaction to which the debit note refers: Provided that—
(a) it shall not be lawful to issue more than one credit note or debit note for the amount of the excess;
(b) if any registered vendor claims to have lost the original credit note or debit note, the supplier or recipient, as the
case may be, may provide a copy clearly marked ‘copy’;
(c) a supplier shall not be required to provide a recipient with a credit note contemplated in paragraph (a) of this
subsection in any case where and to the extent that the amount of the excess referred to in that paragraph arises as a result of the recipient taking up a prompt payment discount offered by the supplier, if the terms of the prompt payment discount offer are clearly stated on the face of the tax invoice.
.. .
(5) Where the Commissioner is satis ed 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 credit note or debit note be issued in terms of this section, the Commissioner may, subject to any conditions that the Commissioner may consider necessary, direct—
(a) that any one or more of the particulars speci ed in paragraph (a) or, as the case may be, paragraph (b) of subsection
(3) shall not be contained in a credit note or, as the case may be, a debit note; or
(b) that a credit note or, as the case may be, a debit note is not required to be issued.
Interpretation Note: No. 84
DATE: ACT: SECTIONS: SUBJECT:
Preamble
26 March 2015
VALUE-ADDED TAX ACT 89 OF 1991
SECTIONS 8 (13), 9 (3) (e), 10 (17) AND 16 (3) (d) THE VALUE-ADDED TAX TREATMENT OF BETS
In this Note unless the context indicates otherwise –
• ‘betting service’ means a supply of services contemplated under section 8(13) • ‘section’ means a section of the VAT Act;
• ‘VAT’ means value-added tax;
• ‘VAT Act’ means the Value-Added Tax Act 89 of 1991; and
• any other word or expression bears the meaning ascribed to it in the VAT Act.
1. Purpose
This Note provides clarity on what constitutes a bet and the concomitant VAT treatment of a bet.
2. Background
Vendors operate various competitions that provide participants (subject to competition rules) with the opportunity to win prizes or awards. Entry to these competitions may be in the form of a purchased entry, free entry or free entry subject to the purchase of speci ed goods or services.
The issue at hand is whether or not the free entry to these competitions constitutes a ‘bet’ on the outcome of an event for purposes of section 8(13). Should the provisions of section 8(13) apply, vendors are entitled to a deduction determined under section 16(3)(d) for the prizes or awards given to competition winners.
488 Juta’s IndIrect tax 2016