Claiming Customs VAT in South Africa

When dealing with the import or export of goods to or from South Africa, it is crucial to understand and comply with the relevant tax laws. Claiming Customs VAT in South Africa can get tricky and land you in deep water if you don’t know what you are doing.

The Amendments to the Value-Added Tax Act, 89 of 1991 became effective on 1 April 2015. If you are dealing with customs clearing in South Africa, it is important to understand this act and fully comply with it, to ensure that you are not breaking the law when claiming customs VAT.

The amendments (specifically to Sections 16(3)(a)(iii); 16(3)(b)(ii); 16(2)(dA) & 54(3)(b)) mainly relate to the documents which must be given to the importer to support any VAT deduction on the VAT 201 return.

The amendment to section 16(2)(dA) read with the amendment to section 54(3)(b)(ii):

“The agent (customs broker) must provide the principal (importer), within 21 days of the end of the calendar month during which goods were imported with a statement of the full and proper description of the goods, the quantity, the value of the goods imported and the amount of tax paid on importation of the goods together with the receipt number of the payment of such tax.”

SARS (South African Revenue Service) does not provide receipts as proof of payment anymore, ever since the implementation of the Customs new financial system, and that tends to complicate things when claiming customs VAT. The deferment account needs to be paid on the statement but without a receipt, what can importers do to claim the VAT on the VAT 201 return?

How Can Importers Claim Customs VAT on the VAT 201 Return?

1. The Tax Invoice which is supplied to the importer must display the deferment settlement date. The importer must take note that the relevant VAT cannot be claimed before the deferment settlement date because that would be equal to claiming for VAT that has not yet been paid, which cannot be done.
2. The Tax Invoice which is supplied to the importer must display the MRN number. This is the proof of payment for Deferred as well as Cash payments and is essential for any claims made.
3. The SAD and worksheet need to be attached to the Tax Invoice as supporting evidence. These must provide the full description of all commodities (multiple line items), measurements (quantities or volumes) as well as taxes paid (VAT & Duty).

How Can I Get Help With Claiming Customs VAT in South Africa?

Following the guidelines above will help you stay on the right side of the law and SARS. When importing or exporting items to South Africa, it is essential that you follow all the necessary steps and get help if and when you need it. A Customs Clearing Agent such as Macro Clearing can assist you with the whole process, making sure that the letter of the law is followed every step of the way.

A simple mistake can land you in trouble just as easily as a willful criminal act, so it is always a good idea to ask for guidance or advice when you are not sure.