The type of supply made by the vendor determines the VAT treatment, as well as whether input tax is deductible in respect of costs incurred to make the supply.
- Taxable supplies include both standard-rated (15%) and zero-rated supplies. A vendor is required to issue a tax invoice within 21 days from the date of making the taxable supply.
- Exempt supplies do not fall within the South African VAT net and are thus not subject to VAT.
- Out-of-scope supplies are the supplies which are not regulated by the VAT Act and include penalties, fines, and dividends.
Source: AJM Tax
