What constitutes a valid VAT invoice?

Deryn GarzBlog Tit-bits

VAT is a diverse and complicated subject which is why it has its own Act that governs what must be disclosed and what may be claimed.  A question that often plagues business owners is what am I permitted to claim?  We can help.

Before we delve into the detail of what constitutes a valid VAT invoice, let us stipulate off the bat that VALID INPUT VAT claims can be held over for 5 years until they ‘expire’ and may no longer ve claimed from SARS or offset against OUTPUT VAT.

What constitutes a valid VAT invoice?  In order for a tax invoice to be accepted by SARS as a valid Tax Invoice in terms of the VAT Act, it must show certain details on the document as set out in section 20(4) and (5) of the VAT Act. SARS categorises 3 types of documents based on the threshold amount including VAT and will thus be accepted by SARS as a valid VAT Input against VAT Output.  These criteria are:

  1. Full Tax Invoice > R5000
    • The words “Tax Invoice “or “VAT Invoice” clearly displayed
    • The Suppliers name, address and VAT number
    • Your company’s name, address and VAT number
    • Invoice number
    • Date of the invoice
    • Accurate description of the goods and/or services
    • Quantity or volume supplied
    • Value of the supply and the VAT amount or percentage
  2. Abridged Tax Invoice >R50 and =< R5000
    • The words “Tax Invoice “or “VAT Invoice” clearly displayed
    • The Suppliers name, address and VAT number
    • Invoice number
    • Date of the invoice
    • Accurate description of the goods and/or services
    • Quantity or volume supplied
    • Value of the supply and the VAT amount or percentage
  3. Receipt or till slip >R50 
    • A tax invoice is not required but a document such as a till slip or sales docket indicating the VAT charged by the supplier will be required to verify the VAT claimed.  The Supplier’s name and VAT number should be reflected on the slip.  The supplier may use his company stamp on the back of the till slip.

The claiming of input VAT has many other rules governing it.  These three points merely cover the details required for an invoice to qualify as a VALID VAT invoice.

Remember: Input VAT may NOT be claimed on every purchase!  For more information on the rules surrounding the claiming of input VAT, feel free to contact us by e-mailing info@dlga.co.za

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