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Amendments to Sections 16(3)(a)(iii); 16(3)(b)(ii); 16(2)(dA) & 54(3)(b) of the Value-Added Tax Act, 89 of 1991 Effective 1 April 2015

The above mentioned amendments to the VAT Act, effective 1 April 2015 primarily relate to the documentary evidence which must be made available to the Vendor (importer) to substantiate any import VAT input deduction in their VAT 201 return.

Quote from The amendment to section 16(2)(dA) read with the amendment to section 54(3)(b)(ii):

“The agent (customs broker) must provide the principal (importer), within 21 days of the end of the calendar month during which goods were imported with a statement of the full and proper description of the goods, the quantity, the value of the goods imported and the amount of tax paid on importation of the goods together with the receipt number of the payment of such tax”.

It is common knowledge that the deferment account is paid on statement and since the implementation Customs new financial system, SARS no longer issues receipts as proof of payment.

As SARS they do not issue any proof of payment that would allow the above, they have agreed that that this can achieved as follows:-

  1. Displaying of the deferment settlement date on the Tax Invoice to the importer. This serves to notify the importer that the relevant VAT cannot be claimed before that date (as SARS cannot entertain VAT claims for VAT not yet paid)
  2. Displaying of the MRN number of on the Tax Invoice to the importer. This serves as the receipt number, or proof of payment, for both entries on Deferred as well as Cash.
  3. Attaching of the SAD and worksheet as supporting documents to the Tax Invoice to the importer. This serves to provide the full description of all commodities (multiple line items), measurements (quantities or volumes) as well as taxes paid (VAT & Duty).

Our invoices are being updated with these fields today, which should ensure our invoices comply. In terms of the act please do not claim your VAT back before the deferment date has passed, as this would violate the VAT act.

Should there be any questions do  not hesitate to contact the Freight Management Team.