VAT Registration in South Africa

Compulsory VAT registration kicks in when your taxable turnover exceeds R2.3 million in any 12-month period, or when you sign a written contract that will take you over R2.3 million in the next 12 months. Voluntary registration is available from R50,000 in turnover.

Around 20 working days from the point we have all your signed documents. SARS turnaround can vary, especially if they call you in for a verification interview, so we keep you updated if it runs longer.

R2 970 once-off through Govchain. SARS itself charges nothing. The fee covers the VAT101 application, the power of attorney, document review, and follow-up with SARS.

The standard VAT rate is 15%. Some goods are zero-rated (basic foodstuffs, exports), and some are exempt (financial services, residential rent). Once registered, you charge 15% on most sales and claim back VAT on qualifying business expenses.

Yes. Voluntary registration opens at R50,000 in taxable turnover over the past 12 months. Two common reasons to opt in early: to claim VAT input credits, or to issue VAT invoices to corporate and government clients that require them.

A registered company. A business bank account. Customer invoices over R50,000 (or R4,200/month for two consecutive months, for voluntary registration). The director’s certified ID and proof of residence, both not older than 3 months. Company proof of address. A SARS Registered Representative on file. We provide the power of attorney.

Yes. SARS will not process a VAT registration unless the company has an active Registered Representative on file. If you don’t have one yet, we can appoint one as part of the process. See SARS Registered Representative for the standalone service.

You file a VAT201 return with SARS every two months (some businesses file monthly), declaring the VAT you charged on sales and the VAT you’re claiming back on expenses. Govchain handles the filing. See VAT Returns.

Yes. VAT registration is available to sole proprietors, partnerships, and companies. The same R50,000 voluntary and R2.3 million compulsory thresholds apply.

VAT101 is the form used to register for VAT with SARS. It’s what we file to get you a VAT number. VAT201 is the bi-monthly (or monthly) return you submit after registration, declaring the VAT you charged and claimed.

SARS will sometimes approve a backdated VAT effective date, usually to the start of the tax period you applied in. Going further back is rare and only granted with strong evidence (signed contracts, invoices already over R2.3m turnover). Be careful: a backdated effective date means you owe VAT on every sale since that date, even if you didn’t charge it.

SARS assigns one of four categories. Category A and B are bi-monthly (most small companies, alternating odd/even calendar months). Category C is monthly for businesses with turnover over R30 million or where SARS suspects compliance issues. Category D is bi-annual for farming and some primary-sector businesses. SARS picks the category at registration based on expected turnover.

Limited yes. You can claim VAT input on stock on hand at the date of registration (goods you bought to resell). You can’t generally claim VAT back on services consumed before registration, or on assets bought more than 5 years before registration.

For about 1 in 3 applications, SARS calls the director in for a verification interview at a SARS branch before issuing the VAT number. They check that the business is real and not a shell. We brief you on what to expect: bring originals of all the documents we filed, and be ready to explain what the company sells and to whom.

A valid tax invoice must include: the words "Tax Invoice"; supplier name, address, and VAT number; customer name, address, and VAT number (for invoices over R5,000); a unique invoice number; the date; a description of goods or services; the quantity; the price excluding VAT; the VAT amount; and the price including VAT. Missing details mean your customer can’t claim the input credit.

10% of the VAT due as a once-off late-payment penalty, plus interest charged monthly at the SARS prescribed rate (currently 11.75% per year). Repeated late filings or late payments can escalate to criminal sanctions under the Tax Administration Act.

Yes, if your taxable turnover drops below R2.3 million for 12 consecutive months you can apply to deregister. SARS will recover VAT on any business assets still on hand at deregistration (the "exit charge"), valued at market value.

Zero-rated supplies are taxed at 0% but you can still claim input credits (exports, basic foods like brown bread, maize meal, fresh fruit and veg). Exempt supplies have no VAT and you can’t claim related inputs (residential rent, education, financial services). The difference matters because zero-rated activity keeps your VAT cash position positive while exempt activity costs you the input VAT.

Yes. After registration, Govchain VAT Returns handles every VAT201 filing. A qualified tax practitioner prepares, reviews, and submits each return to SARS for R2,000/month flat. No hourly billing.