Page 59 - Juta's Indirect Tax

s 18 VALUE-ADDED TAX ACT 89 OF 1991 s 18
extent of the application or use of goods or services shall be deemed to take place on such rst-mentioned date: Provided further that where a vendor ceases to be a vendor prior to any day contemplated in this subsection, any reduction or increase in the extent of the application or use of goods or services shall be deemed to take place immediately before that vendor ceased to be a vendor.
[Sub-s. (6) substituted by s. 92 (1) of Act 17 of 2009, and words preceding the proviso substituted by s. 135 of Taxation Laws Amendment Act, 2015 (punctuation inserted) – date of commencement: date of promulgation of Taxation Laws Amendment Act, 2015.]
(7) For the purposes of subsections (2) and (5) of this section, the extent of the application or use of any goods or services for the purpose of making taxable supplies shall be determined with reference to the application or use of such goods or services during the 12 month period ending on the day any reduction or increase in the extent of the application or use of such goods or services is deemed by subsection (6) to have taken place: Provided that where any goods or services are acquired, manufactured, assembled, constructed or produced by a vendor or are deemed under subsection (4) to have been supplied to that vendor during such 12 month period, the extent of the application or use of such goods or services shall be determined with reference to the period ending on the day contemplated in subsection (6) and commencing on the date such goods or services are acquired, manufactured, assembled, constructed or produced by the vendor or are deemed to be supplied to the vendor under subsection (4): Provided further that where the period between the commencement date and the date contemplated in subsection (6) is less than a 12 month period it shall for the purposes of this section be deemed to be a 12 month period.
(8) Where a deduction of an amount contemplated in paragraph (b) of the de nition of ‘input tax’ in section 1 has been made by any vendor in respect of the sale to him of any second-hand goods and subsequently—
(a) that sale is cancelled; or
(b) the nature of that sale is fundamentally varied or
altered; or
(c) the previously agreed consideration for that sale is
reduced; or
(d) the second-hand goods or part of the second-hand
goods sold are returned to the supplier,
and, as a result of the occurrence of one or more of the abovementioned events, the input tax actually deducted in relation to such sale exceeds the input tax properly deductible by the vendor, either the amount of that excess shall be deemed to be tax charged in relation to a taxable supply made by that vendor in the tax period during which the said event has occurred, at the rate of tax which applied when the said deduction was made, or the amount of input tax deducted in terms of section 16 (3) in the said tax period shall be reduced by the amount of the said excess.
[Sub-s. (8) added by s. 18 (h) of Act 20 of 1994.]
(9) Where a vendor has acquired or imported a motor car (in respect of which input tax has been denied in terms of section 17 (2) (c)) and has subsequently converted that motor car into a game viewing vehicle or a hearse, as contemplated in paragraph (e) or (f) of the de nition of ‘motor car’ in section 1, that motor car is deemed to be supplied in that tax period to that vendor, and the Commissioner shall allow that vendor to make a deduction in terms of section 16 (3) of an
amount equal to the tax fraction of the lesser of—
(a) the adjusted cost; or
(b) the open market value,
of that motor car on the day before that conversion: Provided that this deduction excludes any amount of input
Juta’s IndIrect tax 2016
tax which quali es or has quali ed for a deduction under another provision of this Act.
[Sub-s. (9) added by s. 103 (1) (d) of Act 32 of 2004.] (10) Where—
(a) goods or services have been supplied by a vendor at the zero rate in terms of sections 11 (1) (c), 11 (1) (m), 11 (1) (mA) or 11 (2) (k) to a vendor, that is a customs controlled area enterprise or an IDZ operator; or
(b) goods have been imported into the Republic by a vendor, being a customs controlled area enterprise or an IDZ operator and those goods are exempt from tax in terms of section 13 (3),
and where a deduction of input tax would have been denied in terms of section 17 (2), or to the extent that such goods or services are not wholly for consumption, use or supply within a customs controlled area in the course of making taxable supplies by that vendor, that is a customs controlled area enterprise or an IDZ operator, those goods or services shall be deemed to be supplied by the vendor concerned in the same tax period in which they were so acquired, in accordance with the formula:
A3B
in which formula—
‘A’ represents the rate of tax levied in terms of section 7
(1); and
‘B’ represents—
(i) the cost to the vendor of the acquisition of those goods or services which were supplied to him or her in terms of sections 11 (1) (c), 11 (1) (m), 11 (1) (mA) or 11 (2) (k); or
(ii) the value to be placed on the importation of goods into the Republic as determined in terms of section 13 (2).
[Sub-s. (10) added by s. 103 (1) (d) of Act 32 of 2004, amended by s. 109 (1) (c) of Act 31 of 2005, substituted by s. 85 of Act 20 of 2006 and amended by s. 149 (1) (c) of Act 22 of 2012 – date of commencement deemed to have been 10 January 2012. The amendment of the subsection applies in respect of supplies made on or after that date.]
[NB: Sub-s. (10) has been substituted by s. 27 (1) of Act 44 of 2014, a provision that will come into operation on the date on which the Customs Control Act 31 of 2014 takes effect. See Pendlex below.]
Pendlex (to come into operation on the date on which the Customs Control Act 31 of 2014 takes effect)
(10) Where—
(a) goods or services have been supplied by a vendor
at the zero rate in terms of section 11 (1) (c), 11 (1) (m), 11 (1) (mA) or 11 (2) (k) to a vendor, that is an SEZ enterprise or an IDZ operator in a customs controlled area; or
(b) goods have been imported by a vendor, being an SEZ enterprise or an IDZ operator in a customs controlled area and those goods are exempt from tax in terms of section 13 (3),
and where a deduction of input tax would have been denied in terms of section 17 (2), or to the extent that such goods or services are not wholly for consumption, use or supply within a customs controlled area in the course of making taxable supplies by that vendor, that is an SEZ enterprise or an IDZ operator, those goods or services shall be deemed to be supplied by the vendor concerned, that is an SEZ enterprise or an IDZ operator, in the same tax period in which they were so acquired, in accordance with the formula:
A× B
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VALUE-ADDED TAX ACT