SARS weighs in on reversal of 15.5% VAT
The South African Revenue Service (SARS) says all vendors or business that cannot change the Value Added Tax back to 15% can charge 15.5% until May 15th to change back to 15%.
This comes after Finance Minister Enoch Godongwana this week reversed the decision to hike the VAT by 0.5% following a public outcry.
According to SARS, VAT vendors who have not implemented the change in rate are advised not to make changes.
"Vendors are expected to charge VAT at the rate of 15% and not 15.5% for the relevant goods and services as per the VAT Act." SARS said in a media statement on Friday. Vendors may use limited time to adjust their systems accordingly and report and pay the VAT."
The taxman said should a vendor not be able to revert to the 15% rate, due to complex system changes, such supplies and purchases must be reported and accounted for at the 15.5% rate until such time that they are able to make the necessary system adjustments which should be completed by no later than 15 May 2025.
"VAT transactions which were charged at 15.5% must be reported in field 12 (for output tax) and field 18 (for input tax) of the VAT return. Adjustments in the form of refunds of the 0.5% rate to customers and from suppliers must equally be reported in fields 12 and 18 respectively."
SARS said the VAT return declarations made will be taken into consideration when verifications and/or audits on the affected VAT tax periods are conducted.
The VAT returns that are to be submitted will continue to calculate the VAT auto calculation using the 15% rate from tax periods or months commencing 1 May 2025.
"Vendors who have already implemented both the rate changes and the Zero-Rating are encouraged to reverse those changes before 1 May 2025."
