CC CLAIMING VAT WHEN PURCHASING FIXED PROPERTY

[Elijah]

Hi

Would like to know what the current law is when a CC purchases Fixed Property [Building]., for 2 different scenarios. 1. The CC is Vat Registered 2. The CC is not registered. What are the implications for both Buyer and Seller?

Many Thanks

[CLIVE-TRIANGLE]

Registered Seller to Registered Purchaser >>> Seller charges VAT and purchaser can claim input credit.
Registered Seller to Unregistered Purchaser >>>> Seller charges VAT but purchaser cannot claim input credit.
Unregistered Seller to Registered Purchaser >>>> Seller does not charge VAT and purchaser can claim transfer duty, if any, as input credit.
Unregistered Seller to Unregistered Purchaser >>>> Seller does not charge VAT and purchaser cannot claim transfer duty, if any, as input credit.

[Elijah]

Thanks for the reply Clive

The case I am dealing with is the 3rd scenario you stated above. i.e Unregistered Seller to Registered Purchaser. The transaction took place a few years ago, and the then Purchaser did not claim Input Credit. They now wish to sell the property, what are their obligations if any. Would they, now be liable to pay SARS the Vat charged in the selling price.

[CLIVE-TRIANGLE]

This scenario:
Unregistered Seller to Registered Purchaser >>>> Seller does not charge VAT and purchaser can claim transfer duty, if any, as input credit?

That would mean that when they bought it, they did not claim the transfer duty the paid?

If they now sell it, the sale would attract VAT, no question, regardless of purchaser.

I would claim the the duty paid from the output VAT, now.