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Chapter 6

FINANCIAL MATTERS

6.8 THE PAYMENT OF VALUE ADDED TAX (VAT)

6.8.1Legislation and Policy Framework

ACTS

  • Act on Value Added Tax, Act 89 of 1991 [VAT]

6.8.2Framework for the Development of School Policy on the Payment of Value Added Tax

In terms of section 12(h) of the Act on Value Added Tax, Act 89 of 1991, the Department and all departmental institutions, with the exception of secondary schools which offer the agricultural field of study, are exempt from the levying of VAT on any goods or services that these institutions provide.

The first paragraph means that VAT will not be levied on any money collected or on the sale of goods manufactured in the course of the curriculum or in any other way.  Boarding fees and the money to transport pupils are also exempt from the levying of VAT.  VAT is, however, to be paid when goods or services are purchased.

With the exception of schools which offer the agricultural field of study, departmental institutions need not register as vendors with the Receiver of Revenue.

The “farming component” of schools which offer the agricultural field of study may be registered as a vendor for the purposes of VAT.  Documents are to be requested from the local branch of the Receiver of Revenue for this purpose.

Enquiries concerning any uncertainties about VAT are to be directed to the local Receiver of Revenue.