Who needs to register for VAT?
In South Africa, VAT registration is compulsory if your taxable supplies exceed R1 million in any 12-month period. If you're below that threshold, you can register voluntarily — and for many businesses, this is worth doing.
Voluntary registration is available if your taxable supplies exceed R50,000 in the past 12 months, or you reasonably expect them to within the next 12 months.
What counts as a taxable supply?
Taxable supplies include most goods and services sold in South Africa. There are three rates:
- Standard rate (15%) — most goods and services
- Zero rate (0%) — exports, certain food staples, petrol
- Exempt — financial services, residential accommodation, public transport
How to register: step by step
Registration is done through SARS eFiling or at a SARS branch. Here's the process:
- Create or log in to your eFiling account at efiling.sars.gov.za
- Navigate to "Register New" → "VAT" under the Registrations menu
- Complete the VAT101 form — your business details, banking info, and expected turnover
- Upload supporting documents: certified ID, proof of address, bank confirmation letter, and business registration docs (CIPC certificate for companies, partnership agreement for partnerships)
- Wait for approval — SARS typically processes applications within 21 business days
What changes after registration?
Once you're VAT-registered, several things change immediately:
- Every invoice you issue must be a SARS-compliant tax invoice
- You must charge 15% VAT on all standard-rated supplies
- You must file VAT returns (VAT201) either monthly or bi-monthly
- You can claim input VAT on business expenses — with valid tax invoices from your suppliers
- You must keep proper records for 5 years
Common mistakes to avoid
- Issuing invoices without your VAT number on them
- Forgetting to update invoice templates after registration
- Claiming input VAT on non-compliant supplier invoices
- Missing filing deadlines — penalties start from day one
- Mixing personal and business expenses in VAT calculations
VAT filing deadlines
SARS assigns you a filing period based on your turnover. Most small businesses file every two months (Category B). The return and payment are both due on the last business day of the month following your tax period.
Missing a deadline triggers an automatic 10% penalty on the outstanding amount — put it in your calendar.
Getting help
SARS has a free helpline at 0800 00 7277. For complex situations — particularly if you're a sole proprietor with mixed taxable and exempt supplies — it's worth consulting a registered tax practitioner for your first few returns.