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VAT implications/registrations between car rental/hire and a taxi

Thursday, 15 January 2015   (0 Comments)
Posted by: Author: SAIT Technical
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Author: SAIT Technical

Q: A client of mine has a taxi business; I would like to know if he can register for VAT. The activities he conducts are car rental/hire and a taxi service.

A: With regards to the query the VAT Act does not exclude taxis operators from registering for VAT they would still have to comply with the minimum registration requirements. In this respect a minimum preceding 12 month taxable supplies of R50 000 (s23(3)(c) VAT Act ).

However, where the transport of people and goods are not cross border per section 11(2)(a) VAT Act, it will be an exempt supply in terms of section 12(1)(g) VAT Act which will result in the taxi operator most probably not achieving the minimum taxable supplies threshold for registration.

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.



Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.

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