Change in VAT rate - how to complete your VAT201

By Yumna Dajee, Senior Indirect Tax Consultant

With the increase in the VAT rate effective from 1 April, one of the many concerns which taxpayers still have, is how to complete their VAT returns. This especially relates to vendors who are registered on the bi-monthly basis [Category-B].

The predicament which taxpayers find themselves in, is how to disclose the supplies made between March which is likely subject to 14% and April which is likely subject to 15% [with the exception of the special time of supply rules] in the VAT201 returns for the April 2018 tax period.

SARS recently provided limited public guidance on how to complete the VAT201 return going forward. SARS’ proposed treatment to complete the VAT201 return is discussed below.

Output Tax

For supplies made on or after 1 April and subject to VAT at 15%, the VAT201 return should be amended to automatically calculate the VAT on consideration [VAT inclusive amount]. The consideration must be included in Field 1 of the VAT return and the 15% VAT automatically calculated in Field 4.

For supplies made on or before 31 March and subject to VAT at 14%, the VAT amount should be calculated manually and included in Field 12 in the VAT201 return [Other and Imported Services].

Input Tax

Similar to the treatment of the output tax, input tax must also be disclosed separately depending on the VAT rate applicable to the input tax claim.

For input tax claims subject to 15% VAT, Fields 14 and 15 must be used to claim the input tax deduction.

For input tax claims subject to 14% VAT, Field 18 [Other] must be used to claim the input tax deduction.

The 14% and 15% is not disclosed separately for VAT on importation. Regardless of the rate which was charged per the invoice and customs documentation, the input tax deduction is claimed in Field 14A and Field 15A [depending on the nature of the importation].

Should you have any queries in this regard please contact BDO Tax team

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