When You Must Register for VAT
- Mandatory registration occurs when your business’s taxable supplies exceed R1 million in any 12 months.
- Voluntary registration is permitted if your annual turnover exceeds R50,000 and you can demonstrate ongoing taxable activities.
How to Register
- Determine Eligibility
- Check your total sales over the last 12 months.
- Ensure your goods or services are subject to VAT.
- Gather Documents
- SARS tax number.
- Proof of business address.
- Bank account in the business’s name.
- Company registration documents (for companies) or ID documents (for sole proprietors).
- Apply Online via eFiling
- Log in to eFiling and select “VAT Registration.”
- Complete the VAT101 form.
- Submit scanned documents for verification.
- Verification and Approval
- SARS may request an interview or site visit to confirm the existence of your business.
- Once approved, you’ll receive a VAT number and instructions on filing returns.
VAT Obligations
- Charge Output VAT: Add VAT to invoices (currently 15%).
- Claim Input VAT: Deduct VAT paid on purchases related to your business.
- File VAT201 Returns: Submit returns bi‑monthly (or monthly if you choose) and pay net VAT due.
- Keep Records: Retain invoices and receipts for at least five years.
Consequences of Late Registration
Failing to register on time can result in penalties and backdated VAT. SARS may estimate your turnover and impose additional interest charges.