- South Africa has increased the compulsory VAT registration threshold from R1 million to R2.3 million, taking many smaller businesses out of mandatory VAT registration.
- The new threshold applies from 1 April 2026 and is the first increase since 2009.
- The hike is intended to reflect inflation and reduce compliance burdens, as well as to keep the smallest businesses out of the upcoming e-invoicing mandate.
- Businesses already registered for VAT but now below the new threshold should assess whether deregistration is worthwhile, as cancellation can trigger VAT consequences on assets held at deregistration.
- Some businesses may choose to remain voluntarily registered to preserve input VAT recovery and because their customers are mainly VAT-registered businesses.
Source: vatcalc.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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