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How does an exporter claim back VAT in terms of the new agreement with Swaziland?

Monday, 01 June 2015   (0 Comments)
Posted by: Author: SAIT Technical
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Author: SAIT Technical

Q: Regarding Notice 270 published by SARS relating to the mutual agreement between South Africa and Swaziland, my question is as follows:

• Is this agreement already in effect?

• Our clients zero rate vat on exports if they themselves deliver the goods to Swaziland or pay for the transport of the goods by a courier company. Do they now have to charge 14% VAT as a result of this agreement between the two governments?

• Where an indirect export takes place, where does the customer claim back the VAT (at the border post or from the Swaziland revenue authority)?

A: Effective date of the agreement

The Notice that you refer to (number 270) specifically states that, in terms of paragraph 1 of Article 8 of the Agreement, the date of entry into force is 27 January 2015.  The Mutual Assistance agreement does not provide for the refund or the levying of the tax.  It does however refer to the appointment of Claims and Refund Manager. 

Standard rate

We are not sure why you say that "we now have to charge 14% VAT”.  If the goods exported are removed from the RSA by the recipient (or the recipient’s agent) to an export country (Swaziland) and the vendor didn’t elect to levy tax at the zero rate, the recipient can claim the tax paid back from the refund administrator. Section A of Part 2 of the Regulations (number 316) issued in Government Gazette No. 37580, 2 May 2014, deals with this. 

The refund of tax is dealt with in Part One of the Regulations and the claim will be made at the border post and not from the Swaziland Revenue authority.  We submit that the VAT refund administrator at the border is in fact the Claims and Refund Manager.  

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.



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