Can VAT be claimed on invoices that were back-dated and didn’t contain a VAT number?
03 February 2015
Posted by: Author: SAIT Technical
Author: SAIT Technical
Q: We registered a client for VAT in November 2014 but we back dated the
application to 2012. The client builds property and then sells them. The invoices for expenses over R5000 do not
have a VAT number on them as these were invoiced prior to the company being
registered for VAT.
Would we still be able to claim the VAT on these expenses even though they
are not fully compliant?
Do we need to get the suppliers to put the VAT number on these invoices?
A: Section 16(2) VAT
Act only allows an input tax credit where the tax invoice complies with section
20 VAT Act and we are not aware of any exception to this, notwithstanding that
section 18(4) provides for such an input claim. However technically section
20(4)(c) VAT Act (i.e. in respect of the recipient vat number on invoice) only
applies to registered vendors and the specific person was not such a vendor at
the time of the supply and issuance of the invoice.
We are aware that this is an ongoing
problem which the legislature would need to address. Due to the cost
implications for claiming inputs that are later disallowed, it is our view that
you apply to SARS for a VAT ruling in terms of section 41B Vat Act or a
directive under section 20(7) VAT Act to minimise the risk to the vendor,
especially as he would have 5 years to claim the input should SARS give a
positive ruling. Note that is not an Advance Tax Ruling as applicable in the
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 decision.