VAT: Electronic services and group exclusion rules

The South African value-added tax (VAT) legislation pertaining to electronic services has evolved significantly in recent years. Amendments to the electronic services regulations, effective 1 April 2019, not only introduced an overarching definition of “electronic services” but also included a group exclusion in respect of specific supplies within a group of companies. As the VAT legislation does not make any distinction between business-to-business (B2B) and business-to-consumer (B2C) transactions, the explanatory memorandum issued with the 2019 amendments indicated that this exclusion is to limit the administrative burden on supplies between companies in the same group.

Source Deloitte



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