Will you be receiving a VAT invoice this year?

All value-added tax (VAT) vendors that have gone through a VAT verification from the South African Revenue Service know how frustrating the delays on input VAT refunds can be when supporting documents do not meet the requirements for a valid tax invoice. Below, we revisit some of the necessary key elements to ensure proper compliance in this regard.

The VAT Act identifies different transactions that each requires different types of tax invoices:

  • If the consideration for the supply is more than R5 000 (including tax), a full tax invoice must be issued.
  • If the consideration for the supply is more than R50 but not less than R5 000 (including tax), an abridged tax invoice may be issued, except when that supply is a zero-rated supply.
  • If the consideration for the supply is less than R50, a tax invoice does not have to be issued.
  • If the Commissioner is satisfied that it is impractical to issue a full tax invoice in respect of a particular transaction and that there are sufficient other records available, the Commissioner may direct that a tax invoice does not need to be issued or certain particulars need not be reflected on the tax invoice.

Commercial invoice versus VAT invoice: the differences

Commercial invoice Tax Invoice

This can be any document, notifying the purchaser to make payment in respect of a transaction. The normal document required by a vendor to deduct input tax:

  • Can be issued for a transaction concerning taxable and non-taxable supplies.
  • Issued in respect of a transaction for a taxable supply only.
  • It can trigger the time of supply for a transaction.
  • Must contain all of the details prescribed in the VAT Act.
  • Under certain circumstances can support a deduction for input tax.
  • Can be used to support a vendor’s deduction for input tax.

Full tax invoice

A full tax invoice must contain the following particulars:

  • The words “tax invoice” or “invoice” or “VAT invoice” may be reflected in on the document;
  • Name, address and VAT registration number of the supplier;
  • Name, address and VAT registration number of the recipient
  • Serial number and date of issue
  • Full and proper description of the goods and/or services;
  • Quantity or volume of goods or services supplied;
  • Price and VAT.

Recently, SARS auditors have focused their attention on the “full and proper description of the goods and/or services” element of tax invoices. This is particularly apparent when invoices only contain information such as “service rendered” or “goods supplied”. These descriptions lack a proper description, and SARS would be well within their rights to regard such invoices as not meeting requirements. Vendors must be cautious on this aspect where invoicing systems merely pull through stock codes or data fields onto tax invoices. Such inadvertent matters could result in a vendor not issuing valid tax invoices.

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

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IC Marais

Professional experience:

IC Marais is a certified CA (SA) with public sector and private sector technical knowledge based on 5 years’ Public Sector accounting, auditing and financial management experience and 5 years audit, tax and accounting experience. Detailed knowledge of private and public sector accounting and auditing standards (GRAP, IPSAS, IFRS, IAS, ISA) and public sector financial legislation (MFMA, etc.)

He enjoys the outdoors, hunting and fishing.



Professional experience:

In 1995, Schalk started as a trainee at Warner and Newton (which became Moores Rowland in 1997 and then Mazars Moores Rowland in 2007) in Bloemfontein. In 1998, Schalk was appointed as manager at Moores Rowland, where he became a partner in 2003. Schalk received his Postgraduate Certificate in Advanced Taxation in 2006 and in 2009 he received his Certificate in the Administration of Estates.



Professional experience:

Cedric started as a trainee at Warner and Newton (which became Moores Rowland in 1997 and Mazars Moores Rowland in 2007), Bloemfontein, in 1986. After completion of his articles, he joined the Special Investigations Division of the Department of Finance (SA Revenue Services) as a senior inspector from 1990 to 1991.



Professional experience:

Lucha started her career as a tax inspector at the Inland Revenue Department of New Zealand. After this she worked in commerce in Canada, Mexico and the United States.

On her return to South Africa, she completed her CA training contract with us and has been with Newtons ever since. She became a Partner in 2012.

Apart from her CA(SA) qualification she also holds a postgraduate certificate in Advanced Taxation (2005) and has the overall responsibility for training as our Training Officer.