Input VAT on double cab vehicles and SUVs used on mine sites
28 November 2014
Posted by: Author: SAIT Technical
Author: SAIT Technical
Q: I would like
to clear the air around the new law that the mines have brought into place that
no open vehicles are allowed on site. Because of this, only double cab vehicles
and SUVs currently used on these sites. As this is a restriction for my client
to buy a single cab pickup truck it has now forced him to purchase a SUV. Can
you please confirm if the VAT can be claimed on this?
A: You are
reminded that the service offered by SAIT is limited to guidance.
Our guidance assumes that the SUV is a motor car as defined
in section 1(1) of the Value-Added Tax Act.
The relevant parts of the definition read as follows: ""motor car”
includes a motor car, station wagon, minibus, double cab light delivery vehicle
and any other motor vehicle of a kind normally used on public roads, which has
three or more wheels and is constructed or converted wholly or mainly for the
carriage of passengers, but does not include…”
We assume that none of the exclusions apply in this case.
In terms of section 17(2)(c) a vendor is not entitled to
deduct from the sum of the amounts of output tax and refunds, any amount of
input tax in respect of any motor car supplied to or imported by the
This section doesn’t provide for an exception on the basis
of the use of the vehicle in the circumstances that you refer to and we submit
that the deduction may not be made.
Disclaimer: Nothing in
this query and answer should be construed as constituting tax advice or a tax
opinion. An expert should be consulted for advice based on the facts and
circumstances of each transaction/case. Even though great care has been taken
to ensure the accuracy of the answer, SAIT do not accept any responsibility for
consequences of decisions taken based on this query and answer. It remains your
own responsibility to consult the relevant primary resources when taking a