Address Confusion on Tax Invoices
29 May 2014
Posted by: Author: Varusha Moodaley
Author: Varusha Moodaley (ENSafrica)
VAT vendors who make taxable supplies of goods or services are obliged to issue tax invoices to the recipients of such supplies within 21 days of having made such a supply.
A valid tax invoice is of utmost importance because without such a document a vendor, being the recipient of a supply, is not entitled to claim any input tax deductions in respect of goods or services acquired in the course or furtherance of making taxable supplies.
The requirements for a valid tax invoice are as follows: a tax invoice for supplies in excess of R5 000.00 must reflect the name, address and VAT registration number of both the supplier and the recipient of the supply. A tax invoice for supplies less than R5 000.00 must only contain such details of the supplier.
There has recently been a great deal of confusion regarding the address that should appear on a tax invoice, i.e. whether it is the physical address, the postal address or any other address.
The law simply requires that the ‘address’ of the supplier and that of the recipient (for tax invoices in excess of R5 000.00) be reflected on the tax invoice. The term ‘address’ is not defined and regard must therefore be had to the ordinary meaning of the word. ‘Address’ is defined in the Oxford English Dictionary as the place where a person lives or an organisation is situated; particulars of this, especially for postal purposes.Based on the ordinary meaning of the word, it seems that a person’s address may therefore be the place at which they wish to receive their post, rather than being strictly limited to a person’s physical address.
Fortunately SARS recently set out the options available to vendors regarding the address that must be reflected on a tax invoice or a credit or debit note issued to either a vendor recipient or a non-resident recipient.The address of the recipient and the supplier that must be reflected on a tax invoice, credit or debit note is either the physical address from where the enterprise is being conducted; the postal address of the enterprise; or both the physical and the postal address of the enterprise.