Seven factors that affect your Vat category

Simangele Mzizi, Fsp Business, 18 Sep. 2014

Tags: sars, vat, vat categories, factors that affect your vat category

Once SARS approves your Vat registration application, it sends you notification with your Vat registration number and the Vat category you fall under.

Vat categories range from A to F and the one you’re in determines the tax period in which you need to submit your Vat return.

Because nothing stays the same for long, there are seven factors that could affect your Vat category.

Read on to find out what they are so you can let SARS know of any changes.

****** Product endorsement ******
SARS changed the VAT201 again...

You've probably seen all the news around SARS and Vat refunds more specifically, that there seem to be serious delays in paying these out. SARS has stated that it's making improvements to its systems to better manage the refunds process (i.e. to prevent abuse by taxpayers as well as by SARS). So, as part of this upgrade, SARS has introduced a few changes to the VAT201 return.

Let’s look at the five new changes introduced recently by SARS on the VAT201 declaration.


Here are the seven factors that could affect your Vat category

  1. A change in the name, address, constitution or nature of your principal business;
  1. Your turnover exceeds R30 million in 12 months;
  1. If you’re a farmer, your turnover exceeds R1.5 million in 12 months;
  1. Where you’re registered for four-monthly tax periods (category F) and your turnover exceeds R1.5 million;
  1. Your turnover as a vendor on the payments basis exceeds R2.5 million in 12 months. This puts you onto the invoice accounting basis;
  1. You form a partnership or joint venture membership; and
  1. There’s an appointment or resignation of a representative vendor of your business.
If any of the above things happen, you must write to SARS and make it aware of the changes. In some cases, the change means you may have to move from your current Vat category to another one.
You must inform SARS of the changes within 21 days of the change. If you don’t, you could get a heavy fine or go to jail for up to 24 months. Don’t take that risk.
If you need more information on Vat categories or if you’re forgotten which Vat category or tax period you fall under, check out the Practical Vat Loose Leaf Service.

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