This documentation is for Taxamo v1. If your account is with Taxamo v2 use the documentation at integrate.taxamo.com/doc.
If you are uncertain of your version please contact support@taxamo.com for assistance.

Do foreign suppliers need to charge VAT for sales to South Africa?

Effective 1 June 2014, South Africa will apply VAT to supplies of electronic services (e-services) made by foreign suppliers to South African customers.

This includes sales to B2C and B2B customers as there is no distinction made in South Africa for this in relation to VAT. The standard VAT rate is 14%.

There is a threshold of 50,000 ZAR for foreign suppliers before it becomes compulsory to register for VAT. This is 50,000 ZAR over any consecutive 12-month period.

How do I activate the South Africa tax region in Taxamo?

Follow these steps to activate support for South Africa in your Taxamo account:

  1. Log in to your Taxamo merchant portal account
  2. Navigate to My Account > Tax Regions
  3. Select South Africa from the tabs on the left
  4. Enter your South Africa tax registration number (required if you use Taxamo invoices)
  5. If you are a foreign supplier, you do not need to tick the check box for domestic VAT
  6. Under ‘Activate/Deactivate Region’, select the period you wish to enable the region from. Enable for immediate, or Enable for a date range.
  7. You can enable in Test mode first, and then Live mode

Note: If you cannot access ‘Live’ mode for this region, please ensure you are on a plan that supports more than one tax region.

Which e-services are in scope for VAT in South Africa?

For foreign suppliers the e-services definition includes the following:

Educational services, if the supplier is not regulated by an educational authority in its own country:

  • Distance teaching program
  • Educational webcast
  • Internet-based course
  • Internet-based educational program
  • Webinar

Games and games of chance:

  • Electronic game, including any:
    • Internet-based game
    • Multiplayer role-playing game
  • Interactive game:
    • Game of chance
    • Game where the result is influenced by the skill of the player
    • Game which is a combination of chance and skill
  • Electronic betting or wagering, where this constitutes the acceptance of a bet or a wager on:
    • The outcome of a race
    • Any other event or occurrence

Internet-based auction service:

  • The supply of an internet-based auction service facility

Miscellaneous services:

  • E-book:
    • Digitized content of any book
    • Electronic publication
  • Audio visual content:
    • Any set of moving visual images or other visible signals, whether with or without accompanying sounds, where the visual images are such that sequences of them are seen as moving pictures
    • Any right to view the visual images or visible signals contemplated above
  • Still images:
    • Desktop theme
    • Photographic image
    • Pictorial image
    • Screensaver
    • And any right to view any of the above listed item
  • Music:
    • Audio clip
    • Broadcast that is not simultaneously broadcast over any conventional radio network in South Africa
    • Jingle
    • Live streaming performance
    • Ringtone
    • Song
    • Sound effect
    • Any right to listen to any of the above listed item

Subscription service to any:

  • Blog
  • Journal
  • Magazine
  • Newspaper
  • Games
  • Internet-based auction service
  • Periodical
  • Publication
  • Social networking service
  • Webcast
  • Webinar
  • Website
  • Web application
  • Web series

How do I file and register for VAT in South Africa?

Registration for SA VAT must be done by downloading a copy of the VAT101, available from the South African Revenue Service (SARS) website, completing and signing the VAT101, which must then be emailed together with the supporting documents to SARS at eCommerceRegistration@sars.gov.za.

The Commissioner will process the VAT101 and determine the date from which a foreign electronic service entity (FESE) is required to commence charging SA VAT, at 14%.

Once the VAT registration is finalised the Commissioner will notify the FESE of the successful VAT registration by emailing the VAT103I (notice of registration).

The FESE must register as an eFiler. Registration as an eFiler will enable the FESE to file VAT201s and make VAT payments from outside SA.

For more information on how to register as an eFiler please visit the SARS website, here’s a useful guide for FESEs.

What are the invoicing rules for South Africa?

The Commissioner directs under section 20(7)(a), that an electronic services supplier must issue a tax invoice for a supply of electronic services containing, as a minimum, the following information:

  • The name and VAT registration number of the electronic services supplier
  • The name and address of the electronic services recipient
  • An individual serialised number
  • The date on which the tax invoice is issued
  • A description of the electronic services supplied
  • The consideration in money for the supply in the currency of any country. If the consideration is reflected in the currency of:
    • The Republic, the amount of the VAT charged or a statement that it includes a charge for the VAT and the rate at which the VAT was charged; or
    • Any country other than the Republic, the amount of the tax charged in the currency of the Republic or a separate document issued by the electronic services supplier to the electronic services recipient reflecting the amount of the tax charged in the currency of the Republic.
  • The exchange rate used

How many times per year are VAT returns required for South Africa?

A monthly tax period or tax periods of two months are available for a foreign supplier. Generally, the monthly tax period would apply.

The foreign supplier is required to use the SWIFT MT103 payment method.

How are refunds/adjustments handled for South Africa VAT?

The VAT relating to the credit should be applied to the VAT return during the period that the credit occurred. This is offset against the VAT on the sales.

How long should the data relating to transactions be retained for?

For South Africa, the data retention period is 15 years.