South Africa VAT

Introduction

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VAT (Value Added Tax) is a consumption tax levied on goods and services at the Standard Rate of 15% in South Africa.  This rate is applied to taxable supplies.  There are also supplies which are either zero rated or exempt.  

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Standard Rated Goods & Services (Taxable)

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• Land and Buildings (fixed property) - Sale of Residential and Commercial property by property developers

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• Professional services – construction/building, estate agents, consultants, architects, engineers, project managers, doctors, private hospital services, lawyers, plumbers, electricians and accountants.

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• Most grocery items and foodstuffs such as meat, fish, white bread, snacks, most canned foods, cigarettes, perfume, medicines, cool drinks, cleaning materials, clothing, footwear, microwave ovens and other household consumables and appliances.

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• Electricity, water and refuse removal.

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• Accommodation, hospitality, tourism and entertainment – restaurant meals, hotel accommodation, liquor sales, arcade amusements, casino slot machines and gambling services, entrance fees to sporting events, theatre performances and film shows, guided tours, game drives and game hunting expeditions. 

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• Furniture, production machinery, installations, motor vehicles

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• Telephone, internet, computer and other telecommunication services.

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• Rental of goods and commercial property such as office space.

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• Motor vehicles, repair services, lubrication oils and spare parts.

 

Zero Rated Goods and Serves ( Zero rate of VAT)

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• Basic Food supplies such as milk, eggs, rice, Fish in tin cans, Fruit and Vegetables. Note this excludes food prepared for immediate consumption such as sandwiches or drinks served in a restaurant.

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• Crude oil, petrol, diesel

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• International transport of goods or passengers from South Africa overseas and vise versa 

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• Services supplied in relation to land located outside South Africa

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• Physical supply of services supplied outside of South Africa

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• Farming Goods such as Seed, pesticides, fertilizers 

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Exempt Goods and Services 

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• Financial services (such as the provision of credit, life insurance, the services of benefit funds such as medical schemes, provident, pension and retirement annuity funds);

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• Residential accommodation in a dwelling (but not commercial holiday accommodation)

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• Passenger Transport. Bus, Train, Taxi

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• Educational services provided by recognised educational institutions such as primary and secondary schools, technical colleges, or universities which have been approved as public benefit organisations 

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• Childcare services provided at crèches and after-school care centres

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Detailed Information on VAT in South Africa can be found in the South African Revenue Service links below

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LAPD-VAT-G02 – VAT 404 Guide for Vendors

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LAPD-VAT-G03 – VAT 409 Guide for Fixed Property and Construction

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LAPD-VAT-G16 – VAT FAQs Supplies of electronic services

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