Page 545 - SAIT Compendium 2016 Volume1

s 78 VALUE-ADDED TAX ACT 89 OF 1991 s 78
reduced to an amount equal to 3 per cent of the value
of the supply; or
(ii) the erection of the dwelling was completed on or
after 30 September 1991 and on or before 31 March 1992 and an agreement for the sale of such xed property was concluded on or after 22 August 1991 and on or before 31 March 1992, the tax chargeable under section 7 (1) (a) in respect of the supply of the xed property under such sale shall, subject to the provisions of subparagraph (i), be reduced to an amount equal to 6 per cent of the value of the supply:
Provided that—
(i) where an agreement has been concluded for the
erection of a dwelling on land supplied under a sale and the consideration payable under such agreement would in terms of section 6 (1) (c) of the Transfer Duty Act, 1949, if that Act were applicable, be required for the purpose of the payment of transfer duty to be added to the consideration payable in respect of the acquisition of the property, such agreement and the sale shall, subject to the provisions of paragraph (ii) of this proviso, for the purposes of this paragraph be deemed to be one agreement for the sale of the property;
(ii) the tax payable in respect of the supply of the land and the supply of the construction services in respect of the erection of a dwelling as contemplated in paragraph (i), shall be separately payable in respect of each supply in accordance with the provisions of this Act;
(iii) where the agreement for the sale of such xed property was concluded before the commencement date, the provisions of paragraph (a) of this subsection shall apply unless the seller and the purchaser under the sale agree in writing that that paragraph shall not apply and that this paragraph shall apply.
[Para. (aC) inserted by GN 2695 of 8 November 1991 and by s. 42 (b) of Act 136 of 1992.]
(aD) Where any agreement (other than an agreement referred to in paragraph (i) of the proviso to paragraph (aC)) for the construction by any vendor carrying on a construction enterprise of any new dwelling was concluded on or before 31 March 1992 and the dwelling was to be erected in the course of such enterprise, the tax chargeable under section 7 (1) (a) in respect of the supply of the construction service, including any construction service supplied to the vendor by a subcontractor, shall to the extent that such services were performed on or before 31 March 1992 be reduced to 6 per cent of the value of the supply.
[Para. (aD) inserted by GN 2695 of 8 November 1991 and by s. 42 (b) of Act 136 of 1992.]
(b) For the purposes of this subsection where an option to purchase xed property or a right of pre-emption in respect of xed property is granted, the agreement for the sale of the property shall be deemed to be concluded when the option or right of pre-emption is exercised.
(10) Where any vendor who is on or with effect from the commencement date registered under section 23 and on that date—
(a) carries on a construction, civil engineering or similar
enterprise and has on hand a stock of materials acquired by him prior to that date in order to be used by him for the purpose of incorporation in any building or other structure or work of a permanent nature to be erected, constructed, assembled, installed, extended or embellished by him in the course of such
enterprise, and sales tax has been borne by him in
respect of such materials; or
(b) has on hand a stock of consumable goods or
maintenance spares acquired under sales concluded by him or the importation by him prior to that date for the purpose of consumption or use in the course of his enterprise, and sales tax has been borne by him in respect of such sales or importation,
[Para. (b) substituted by GN 2695 of 8 November 1991 and by s. 42 (c) of Act 136 of 1992.]
and on or after that date any item of such stock is withdrawn by him for the purpose referred to in paragraph (a) or the purpose referred to in paragraph (b), as the case may be, the vendor may, provided he has taken stock of such materials, consumable goods or maintenance spares, as the case may be, and he retains properly prepared stock lists in respect of such stocktaking, include in the amounts of input tax deducted by him under section 16 (3) in respect of the tax period during which such item is withdrawn, the amount of sales tax borne by him in respect of that item: Provided that where the vendor does not maintain records which are adequate enough to determine when items are withdrawn from such stocks or the sales tax so borne thereon in respect of sales to him of such items, the Commissioner may, on application by the vendor, authorize him to deduct the actual sales tax borne by him in respect of such sales or an amount of sales tax which on the basis of a reasonable calculation represents the amount of sales tax so borne by him on the stocks in equal instalments by way of inclusions in the input tax deducted by the vendor in his tax returns over a period of two years or such shorter period as the Commissioner may allow.
[Sub-s. (10) substituted by s. 47 (j) of Act 136 of 1991.] (10A) Where sales tax has been borne by any vendor (being a person who is on or with effect from the commencement date registered under section 23) in respect of the acquisition of goods (other than xed property or goods incorporated therein) under a sale or the importation of goods and such goods are held by him on the commencement date as trading stock as de ned in section 1 of the Income Tax Act, whether or not the vendor is liable for normal tax under that Act, the vendor may, provided he has taken stock of such goods and he retains properly prepared stock lists in respect of such stocktaking, include the amount of that tax in the amounts of input tax deducted by him under section 16 (3) in respect of the tax period during which such goods are supplied by him in the course or furtherance of his enterprise: Provided that where it appears to the Commissioner that the keeping of records for the purposes of the preceding provisions of this subsection can be dispensed with without prejudice to revenue collections, the Commissioner may, on application by the vendor, authorize him to deduct the sales tax on stocks of such goods so held by the vendor in equal instalments by way of inclusions in the input tax deducted by the vendor in his tax returns over a period of two years or such shorter period as the Commissioner may
allow.
[Sub-s. (10A) inserted by s. 47 (k) of Act 136 of 1991.]
(11) (a) Where any person—
(i) is on the day before the commencement date
(ii)
registered as a vendor under the Sales Tax Act;
at the end of that day has in his possession goods (as de ned in that Act) which he has not disposed of or which he has disposed of under a sale but for which he has not received full payment and in either case sales tax was not borne by him on acquisition; and
SAIT CompendIum oF TAx LegISLATIon VoLume 1
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VALUE-ADDED TAX ACT