Following up from our blog on “who needs to register for tax?”, a similar frequently asked question we receive is “who needs to and when do you need to register for VAT?”. We will answer these and more questions in this article.
Who needs to register for VAT?
If you run a business that has a sales turnover exceeding R 1 million per year, then you are required to register as a VAT vendor. Should your turnover be less than R1 million it may still be beneficial to perform a voluntary registration as you can claim VAT back from supplier purchases and this is then deducted from the VAT you owe SARS. If your turnover is less than R50 000 per annum, you will unfortunately not be able to register as a VAT vendor.
When do I need to register for VAT?
You should register as a VAT vendor if you predict your turnover to exceed R 1 000 000 in a 12 month period. If your turnover has exceeded this, then you are required by law to become a VAT vendor.
How to register for VAT?
You can either elect to register your business as a VAT vendor yourself or you can make use of an accountant / tax consultant to handle the whole process for you. It is worth noting that being VAT registered will take more administration time and you will be required to submit VAT payments to SARS according to the VAT cycle you are allocated. You will also be required to keep records according to the requirements SARS sets out for VAT vendors. Often this process is made much easier by using the professional services of an accountant / tax consultant.
Registering yourself as a VAT vendor
Should you wish to process your own registration for VAT, you can visit SARS and complete a VAT101 form. If you are a company, you can register in your business name, however if you are a sole proprietor or in a partnership, you must register in your own name(s).
Registering through an accountant / tax consultant
By selecting an accountant/tax consultant to handle your VAT registration, record keeping and VAT returns, you free up your time or your staff’s time so they can concentrate on your core business. The whole process is made a lot simpler and you benefit from the expert advice regarding VAT compliance. Your VAT cycle will be strictly followed to ensure your VAT payments are always on time.
For professional help in VAT registration and maintenance, call Brett on 021 421 4444.