VATupdate
VAT

VAT rates in South Africa

Quick overview

Standard Rate Reduced Rate Other Rates
15% N/A Zero-rated (0%) and exempt

The local name for VAT in South Africa is Value-added tax (VAT).

There is basically 1 VAT rate in South Africa:

  • Standard VAT rate is 15%

Recent developments

For more information about (recent) rate change developments in South Africa, please click HERE.

Standard rate: 15%

This rate applies for all transactions that take place in South Africa, unless an exception applies (such as a reduced rate, the zero rate or an exemption, or a reason to treat the transaction as outside scope of VAT).

Zero rate (0%)

Examples of goods and services taxable at 0%, with the right to deduct VAT

  • Exports of goods and related services
  • International transport of passengers and goods, and related services
  • Services supplied outside South Africa and to foreign branches and head offices
  • Services supplied directly in connection with land or any improvement thereto outside South Africa
  • Services deemed to be supplied to a public authority or municipality
  • Certain basic foodstuffs
  • Sanitary towels (pads)
  • Illuminating kerosene and leaded and unleaded gasoline
  • Supply of gold coins issued by the reserve bank
  • Transfer of a business as Transfer of a Going Concern
  • Supply of fuel levy goods and certain fuels obtained from crude to be refined to produce fuel levy products
  • Supply of intellectual property for use outside of South Africa
  • Triangular supplies (the vendor supplies goods to a nonresident but delivers them in South Africa; special requirements apply)
  • The supply of goods that have been imported and entered for storage in a licensed Customs and Excise storage warehouse but have not been entered for home consumption
  • The supply of certain goods used or consumed for agricultural, pastoral or other farming purposes

Examples of exempt supplies of goods and services, without the right to deduct VAT

  • Financial services, including Sharia finance premiums
  • Fare-paying passenger transport by road or rail
  • Educational services
  • Child care
  • Donated goods supplied by certain nonprofit (charitable) bodies
  • Rental of residential accommodation
  • Immovable property located outside South Africa
  • The supply of goods by a non-established business before the goods are entered for home consumption, unless the non-established business applies in writing to the SARS to have the supplies zero-rated
  • Certain supplies made by bargaining councils to their members are exempt from VAT. The exemption was previously limited to situations in which the supplies were covered by membership contributions

A global VAT/GST rate overview can be found here (note this is a work in progress).

This post was last updated on October 13, 2021.

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