- SARS has replaced Issue 4 (2016) with Issue 5 of Interpretation Note 31, which sets out the documentary proof SARS accepts to support a zero-rating. Under section 11(3) of the VAT Act, read with the burden-of-proof rule in the Tax Administration Act, a vendor applying the zero rate must obtain and retain acceptable documentation, or risk bearing the 15% output tax itself.
- Issue 5 introduces several practical changes: it updates the two tables (goods and services) for zero-ratings added since 2016, amends the acceptable documents for certain supplies (e.g. allowing annual confirmations by key office bearers for some recurring transactions), and expands the guidance on the 90-day rule for obtaining documents, including late arrival and exceptions.
- A subtle but significant shift is the removal of the “alternative documentation” route: rather than seeking approval for substitute documents, a vendor in an uncovered scenario must now apply to the Commissioner in writing before zero-rating a supply of movable goods. This may signal that missing listed documentation reflects SARS’s view that certain supplies may not qualify for zero-rating at all—so vendors should verify the documentation per transaction and consider a ruling where exposure is material.
Source Pieter Van Der Zwan
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