[Question] VAT Charged by booking agency

[in_the_cornfield]

Hello there,

I recently booked some travel through an online booking service for work. I have asked them for tax invoices. They are a VAT vendor, so logically they must charge VAT on the bookings they make. They claim that it is up to the actual provider of the accommodation to provide a VAT invoice and if the provider is not registered, that is that.

Is there a reason or loophole that a booking agency who is a VAT vendor should be allowed not to charge VAT to customers who booking accommodation and services through them?

If this is the case, how do they collect VAT to hand over to SARS? From charging VAT on the commission they charge the establishments?

This just seemed fishy to me, so I thought I would consult a more informed audience.

[Mike C]

Hi in_the_cornfield.

As I understand it, the Booking Agency charges you VAT on their service to you ... not on what VAT they are charged.

So some of their providers may charge VAT and others not. They would work out the total cost of the package to you, and then add their service fee plus VAT on their service Fee.

They have to hand over to SARS the VAT they they charge you. Their providers hand over VAT that they charged the booking agent (if any).