[Question] How do you charge VAT when building a new house

[Reinette]

Hi,

I am doing the bookkeeping for a (Pty) Ltd registered as a VAT vendor.

We are building a new house for the first time. The agreement was that the client would pay for all the material. We are managing the site on a daily basis and charge for the labour, a professional (or builders) fee and extra's i.e. rental of equipment every fortnight. I have added VAT to the invoices. The architect who is doing the cost consolidation for the client is arguing that we can't charge VAT. I think he is wrong, but have looked everywhere and can not find a clear answer. Can anyone tell me what the correct way is to do this, please?

Thanks

[Andromeda]

Hello Reinette, perhaps this helps, although I gather your company does not own the property? https://www.saica.co.za/integritax/2...l_property.htm

Otherwise you should refer to the SARS Guideline, it should be Chapter 6 http://www.sars.gov.za/AllDocs/OpsDo...nstruction.pdf

[Reinette]

Thank you. This confirms that we should be charging VAT as I thought. The question is now how do I deal with this architect that scratches out the vat on invoices and doesn't pay us the vat?

[Andromeda]

I suggest you ask him for a reason and reference. I would hate to suggest that you be hard nosed about it, only to discover that he has a valid reason, because I presume this is not his first assignment.