Is the provision of therapy services for children with autism an exempt supply?
09 March 2015
Posted by: Author: SAIT Technical
Author: SAIT Technical
Q: My client has
a close corporation and the nature of the business is "therapy for children
I have heard that training or education of persons with a
permanent physical or mental impairment is an exempt supply. Is this true?
A: For purposes
of section 12 of the Value Added Tax Act, supply of educational services by the
following entities is exempt from VAT:
All State schools or schools registered under the South
African Schools Act, 1996 or a further education and training institution
registered under the Further Education and Training Act, 1998.
Universities, universities of technologies (previously known
as technikons), colleges and other institutions providing higher education
which are registered under the Higher Education Act, 1997.
Institutions which are approved Public Benefit Organisations
(PBOs) in terms of section 30 of the Income Tax Act which supply any of the
- adult basic education and training (ABET);
- education and training of religious or social
- educating and training of persons with permanent
physical or mental impairment; or
- bridging courses to indigent persons to enable
them to enter a higher education institution.
The supply of those services will only be exempt from VAT in
as far as the entity that renders those services is registered as a "public
benefit organisation” in terms of s 30 of the Income Tax Act.
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.