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Thread: VAT Vendor and Non VAT Vendor query

  1. #1
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    VAT Vendor and Non VAT Vendor query

    Good day to all

    I have a hypothetical question regarding the sales to a non-VAT Vendor company with my company being a VAT Vendor.

    My question is as follows:
    I have sold inventory to a company on credit where there is no VAT number on the credit invoice, to my fairly little knowledge on VAT, this means that this company is not a VAT Vendor, or this company's invoice is insufficient, but my question is based on the company I am selling to is not a VAT Vendor. On the invoice, VAT @ 15% has been charged and added to the total with no VAT number from the client I am selling to on the invoice. To my knowledge if a non-VAT Vendor pays VAT, it cannot be claimed from SARS, but a VAT Vendor can claim the VAT that was paid.

    Can anyone please advise me what would be done in the general journal regarding VAT Output in this situation where the client is not a VAT vendor? Should there be VAT charged? Should there no VAT be charged and the products only be sold on selling price excluding VAT @ 15%? I am quit new Tax and some of the things I have read are not clear on this.

    Thanks in advance.

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    A vat vendor is required to charge VAT, whether or not the buyer is a vat vendor, and to pay same to SARS. Legislation also requires that the VAT vendor provide the customer with a compliant invoice.

    If the vat vendor's invoice does not reflect the vat number of the customer, the customer can request that it be corrected.

    Whether or not the the customer is a vat vendor in no way affects the vendor's duty to remit vat charged to SARS

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    New Member digitaldisplay.co.za's Avatar
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    Hello, this is the topic I interested in.

    Firstly I am not VAT registered and busy with a quotation worth more that R1M. I know I can not charge VAT. How do I invoice if I win the contract? Do I immediately go and register for VAT? That will increase my invoice by 15% from the quotation.

    Secondly, when I add my mark-up from the supplier who is VAT registered. R1000 plus R150 = R1150 that's my purchase price I add 20% markup R1150 plus 20% = R1380. So I don't ow SARS any VAT?

    Thank you in advanced.

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