Four Vat refund rules every Vat vendor needs to live by

43984, 06 Nov. 2014

Tags: sars, vat refund, claiming a vat refund

There’s only one instance where SARS has to pay you instead of you paying it: That’s when you’re due a Vat refund.
But SARS doesn’t part with money that easily.
You must play by its rules when you claim the Vat refund you so desperately need to boost your cash flow. If you don’t, not only could you end up forking out a lot of money in the form of penalties, you could face jail time too!
So what are the Vat refund rules that will help you avoid such trouble and claim your refund correctly?
Here are the four rules you need to keep in mind to claim back your Vat refund
Rule #1: If your input tax exceeds your output tax, you’re entitled to a Vat refund.
Rule #2: If your output tax exceeds your input tax, the difference shows the Vat liability you’ll have to pay over to SARS.
Rule #3: You can’t off-set a refund for one tax period against Vat payable for another tax period – but SARS can!
Rule #4: You must have documentary proof for every item you claim input tax for.
If you can’t prove it, or if your records are incomplete or invalid, don’t even attempt the claim. SARS sees this as fraud.
Be warned! You’ll end up in a great deal of trouble if you go against these Vat refund rules
If you claim your Vat refund incorrectly, SARS can hit you with penalties that include a fine or even jail time for up to five years for evasion!
Don’t take chances.
Now that you know about these four rules, follow them so you can claim your Vat refund correctly and avoid the wrath of SARS.

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