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Thread: Does a Joint Venture have its own PAYE & VAT?

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    Question Does a Joint Venture have its own PAYE & VAT?

    Hi, Does a joint venture have its own Income tax, PAYE and VAT and if it does, how do I
    go about registering those tax types on efiling as my main objective is requesting a tax
    pin with the name of the JV and all its other tax info,

    I've called the SARS call center but it seems all the agents I've spoken to have no clue
    of anything concerning a joint venture.

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    It does yes. Before I say more, is this a partnership or a joint venture. In other words, is the life of the entity finite, or infinite?

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    It is a joint venture and the life of the JV is finite. After the project at hand is complete we will resume to conducting business as separate companies.

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    Ok then it is a JV and for VAT registration you should select the 2nd box, Partnership / Body Of Persons.
    For PAYE registration it is M, Unincorporated Body Of Persons
    Income Tax Registration, as far as I know, is for an Unincoporated Partnership. Some information I have received says that each participant is taxed separately based on the % interest. To be honest I am not sure

    In all three cases the Joint Venture Agreement is required as well as the incorporation documents of the participants.

    Edit: I gather that a VAT128 is required to support a VAT101
    Last edited by Andromeda; 12-Feb-21 at 09:27 AM. Reason: Income tax, unsure of registration.

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    It seems the information regarding income tax registration is correct, i.e. the joint venture partners are taxed based on the % share in the joint venture, as in a partnership:

    Tax considerations
    When establishing a joint venture, what tax considerations arise for the joint venture parties and the joint venture entity? How can tax charges be lawfully mitigated?

    There are generally no tax costs in setting up a joint venture as a company or a partnership. If the joint venture is set up as a company, the company is generally the tax-paying entity and there will only be tax on distributions to shareholders. In the case of a partnership, and because a partnership is not defined as a person for normal tax purposes, it is not a taxable entity. For certain other purposes (for example, value added tax), however, the partnership is regarded as a body of persons, but only for those purposes. Since a partnership is not a taxable entity, and its individual partners are liable for normal tax on their portion of the partnership’s profits, the income that has been received by a partnership is deemed to have been received by the partners individually on the same date as the receipt of the book by the partnership, in accordance with their profit-sharing proportions as set out in the partnership agreement.

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    Dave A (20-Feb-21), retsigeR (16-Feb-21)

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    Thank you so much! I am now well informed as to the approach I should take and what to consider.

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