Page 64 - Juta's Indirect Tax

s 21 VALUE-ADDED TAX ACT 89 OF 1991 s 22
(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.
(4) Where a recipient, being a registered vendor, creates a document containing the particulars speci ed in this section and purporting to be a credit note or a debit note in respect of a supply of goods or services made to the recipient by a supplier, being a registered vendor, that document shall be deemed to be a credit note or, as the case may be, a debit note provided by the supplier under subsection (3) where—
(a) the Commissioner has granted prior approval for the issue of such documents by a recipient or recipients of a speci ed class in relation to the supplies or supplies of a speci ed category to which the documents relate; and
(b) the supplier and the recipient agree that the supplier shall not issue a credit note or, as the case may be, a debit note in respect of any supply to which this
subsection applies; and
(c) a copy of any such document is provided to the
supplier and another copy is retained by the recipient:
Provided that—
(i) where a credit note is issued in accordance with this subsection, any credit note issued by the supplier in respect of that supply shall be deemed not to be a credit note for the purposes of this Act;
(ii) where a debit note is issued in accordance with this subsection, any debit note issued by the supplier in respect of that supply shall be deemed not to be a debit note for the purposes of this Act.
(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.
(6) Where any recipient, being a registered vendor, has been issued with a credit note in terms of subsection (3) (a), or has written or other notice or otherwise knows that any tax invoice which the vendor holds is incorrect as a result of any one or more of the events speci ed in any of paragraphs (a), (b), (c), (d) or (e) of subsection (1) and has made a deduction of any amount of input tax in any tax period in respect of the supply of goods or services to which the credit note or that notice or other knowledge, as the case may be, relates,
either the amount of the excess referred to in subsection (3) (a) shall be deemed to be tax charged in relation to a taxable supply made by the recipient attributable to the tax period in which the credit note was issued, or that notice or, as the case may be, other knowledge was received, or the amount of input tax deducted in terms of section 16 (3) in the last- mentioned tax period shall be reduced by the amount of the said excess, to the extent that the input tax deducted in the rst-mentioned tax period exceeds the output tax properly charged.
[Sub-s. (6) substituted by s. 34 (b) of Act 97 of 1993 and by s. 136 (1) of Taxation Laws Amendment Act, 2015 – date of commencement deemed to have come into operation on 1 April 2016*.]
(7) Where any recipient, being a registered vendor, has been issued with a debit note in terms of subsection (3) (b) and has made a deduction of any amount of input tax in any tax period in respect of the supply of goods or services to which that debit note relates, the recipient may, subject to the provisions of section 17, make a deduction of input tax in terms of section 16 (3) in respect of the amount of the excess referred to in subsection (3) (b) in the tax period in which the debit note is issued, to the extent that the output tax properly charged exceeds the input tax deducted.
(8) Notwithstanding anything to the contrary in subsection (3), where a vendor acquires an enterprise from another vendor and as a result of that acquisition, the supplying vendor immediately ceases to be a vendor, and the purchasing vendor, within a period of six months from the date of acquisition, issues or receives a credit note or debit note, as the case may be, in respect of the acquired enterprise, that credit note or debit note may re ect the name, address and VAT registration number of the supplying vendor.
[Sub-s. (8) added by s. 36 of Act 18 of 2009.]
22 Irrecoverable debts
(1) Subject to subsection (6) where a vendor—
[Words in sub-s. (1) preceding para. (a) substituted by s. 140 (1) (a) of Act 24 of 2011 – date of commencement: 10 January 2012.]
(a) has made a taxable supply for consideration in
money; and
(b) has furnished a return in respect of the tax period
for which the output tax on the supply was payable and has properly accounted for the output tax on that supply as required under this Act; and
(c) has written off so much of the said consideration as has become irrecoverable,
the vendor may make a deduction in terms of section 16 (3) of that portion of the amount of tax charged in relation to that supply as bears to the full amount of such tax the same ratio as the amount of consideration so written off as irrecoverable bears to the total consideration for the supply, the deduction so made being deemed for the purposes of the said section to be input tax: Provided that—
(i) where tax charged in respect of a supply of goods under an instalment credit agreement has become irrecoverable, any deduction in terms of section 16 (3) as provided for in this section, shall be restricted to the tax content of the amount which has become irrecoverable in respect of the cash value of such supply, as applicable in respect of that agreement in terms of section 10 (6);
(ii) the amount which has become irrecoverable in respect of such cash value shall be deemed to be an amount equal to the balance of the cash value remaining after deducting therefrom so much of the sum of the payments made by
* Section 16 (1) of Taxation Laws Amendment Act, 2015 reads: ‘Subsection (1) is deemed to have come into operation on 1 April 2016.’ It is not clear whether this should have indicated ‘come into operation on 1 April 2016’ or ‘are deemed to have come into operation on 1 April 2015’.
56 Juta’s IndIrect tax 2016