Hi everyone,

Im completely confused on this one and need to make sure before I make a massive mistake.

We distributor products into South Africa and we going to start distributing Digital products which we buy online and then download them. We however recieve the boxes for the items and just add the download code to the box.

Now the question comes in, the boxes will be imported and probably cost like R20??? or something, so we'll pay the VAT on that. Then after that the digital download becomes the question, we have to sell the items with VAT on them but the items cost close to R10 000.00, so we add VAT but now where is the input VAT to this, besides the boxes? Should we still pay VAT on it?

I personally think this should be VAT free but thats my thoughts. Any ideas?