What is Output VAT?
Output VAT is the standard rate VAT calculated on the sale of goods and services of a vat registered business. The output VAT must be paid over to SARS and is disclosed as a liability in the books of the business.
When sales are processed an amount of vat of that sale will be credited to the VAT control account of the business. The VAT liabilities must be declared and paid to SARS. Not paying over VAT that was charged is a criminal offence.
Frequently asked questions:
Who pays the Output VAT?
The business who sells the goods or services will be required to declare their output vat to SARS. They will however be able to claim the vat on purchases made them.
Do you pay input or output vat to SARS?
You would pay Output VAT to SARS. You can claim your input tax against the Output VAT paid.
When is VAT Payable?
On the earlier of receipt of payment or invoice. Whichever comes earlier.
Must I charge VAT on my invoices?
If you are registered for VAT then yes you must. If you don't deduct VAT then this is in contravention with the VAT Act and can attract penalties or worse depending on the offense.
Is VAT charged on sales?
Output tax is charged on taxable supplies and will have to be declared as such on the vat return.
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