Should I be registered for VAT?
By Alicia Human · Updated
Dear TaxTim
It has recently come to my attention that I should maybe have registered for VAT. Can you please advise me. I am a contractor providing a writing and editing service mostly to one client, but also to a few smaller ones and my income is in excess of R1 million. I am not registered as a company and I have very few expenses so little to claim by way of input tax.
It has recently come to my attention that I should maybe have registered for VAT. Can you please advise me. I am a contractor providing a writing and editing service mostly to one client, but also to a few smaller ones and my income is in excess of R1 million. I am not registered as a company and I have very few expenses so little to claim by way of input tax.
Unfortunately, VAT do not fall within our scope of services. I can, however, provide you with the basic details:
Yes, you are required to register for VAT once your income exceeds R1 million within an applicable tax year. This requirement applies to you even though you are trading as a sole proprietor or freelancer, not a company. Even though you have few expenses and may not have much to claim in input tax, you are still obligated to register as a VAT vendor. If you have zero-rated supplies (such as exports), you can still claim input VAT on business-related expenses, which might provide some tax benefit.
Yes, you are required to register for VAT once your income exceeds R1 million within an applicable tax year. This requirement applies to you even though you are trading as a sole proprietor or freelancer, not a company. Even though you have few expenses and may not have much to claim in input tax, you are still obligated to register as a VAT vendor. If you have zero-rated supplies (such as exports), you can still claim input VAT on business-related expenses, which might provide some tax benefit.