7 Documents you must keep to zero-rate your supplies on your Vat return

Fsp, 26 Feb. 2013

Tags: vat on zero-rate supplies, what is 0% vat, can i claim zero-rate vat on this? zero-rate supporting documentation, where do i complete zero-rating on my vat return



I was having lunch with our Vat expert on Tuesday, and she mentioned that one of the biggest problems people face when zero-rating export supplies is that they don’t submit the correct documentation when submitting their Vat returns.

One of our subscribers confirmed this yesterday, when she sent me an email asking about which documents to submit together with her Vat return to claim her with her zero-rating supplies.

Let’s look at her question...


Jenny’s Beads manufacture jewellery in Johannesburg. They export 90% of the manufactured products.   She wants to know if she can zero-rate these goods when she exports them.

Yes Jenny, you can. But you must keep piles of documents to substantiate your zero-rating claims to SARS.  Let’s find out what these documents are.


What is a Zero-Rated Supply?


A zero-rated supply is a supply of goods or services that the Vat Act allows you to make with Vat at zero per cent.


What is a Direct Export?


When the seller of the goods (South African Vat vendor) delivers or arranges (and pays for) delivery for the goods to a clients address in a foreign country himself. In this case, Vat is levied at zero percent!


Checklist of 7 essential documents to keep for zero-rated supplies
 

  • The order or contract of sale between you and your foreign client
  • Your copy of the zero-rated tax invoice
  • Copy of a VAT262 for or VAT266 form, with the original Customs and Excise stamp on
  • Customs export documentation – eg. CCA1, SAD 550
  •  As from 15 March 2006, a copy of the Customs export or removal document (DA74)
  • Proof that your foreign client received your goods, e.g. a signed delivery note
  • Proof of payment.



Latest:

Comments
2 comments



Alfred 2013-03-10 16:13:06

What if I sell programs to foreign countries. The download it from the internet. Thus no customs and excise stamp. Called SARS to no avail. Can I still zero rate and what about the documentation that don't exists now.

Quintin 2013-03-09 09:19:44

Is it proof of funds from any source. Or does it have to be foreign source funds, meaning bank accounts out of SA?


 


RSS Facebook Share the experience
Accounting and Tax Club.co.za

Topics
  • Accounting
  • Allowances and deductions
  • Audit/Assessment
  • Capital gains tax
  • Dividends
  • Donations Tax
  • Exports and imports
  • Fringe benefits
  • Input tax
  • Provisional tax
  • Sars
  • Tax basics
  • Tax invoices
  • Tax returns
  • Vat basics
  • Vat registrations
  • Vat return
Premium Services
  • Company Registration
  • Objections
  • PAYE
  • Trusts
  • Turnover Tax
  • UIF
  • Wear and Tear
TOP ANSWERS 2017
HI there What I am trying to establish is what amount should I use when using the formula (A-B) x C/100 x D/12 ...[read more]
Published on 31 Mar. 2017 2 answers
I know there is no VAT on the Licence itself. What about the Transaction Fee charged when you renew a licence ? Ie on a...[read more]
Published on 13 Apr. 2017 1 answer
In terms of the VAT Act on amounts exceeding R5 000 a full tax invoice must be issued. However, if for instance a VAT...[read more]
Published on 03 Apr. 2017 1 answer
Taxpayer T has always received a tax refund on an Employer Provided Vehicle (other than the operating lease) in...[read more]
Published on 10 Apr. 2017 1 answer
My South African business offers software design services to companies and individuals in Taiwan. We have 2 agents...[read more]
Published on 13 Mar. 2017 1 answer
Good Day, A 3rd party supplier who rendered a service did not charge VAT on their invoice when the invoices us. We...[read more]
Published on 13 Apr. 2017 1 answer
Video Archive Video club

Your library of Free eReports
View full library
SARS Tax Tables 2016/2017 Download


Simply click download for your FREE SARS Tax Tables 2016/2017 to ensure you calculate your tax correctly.