ARTICLE · 08 JULY 2013

Value-Added Tax And Transfer Duty … A Practical Reminder

ENS

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There still seems to be little awareness regarding the interplay between value-added tax and transfer duty, and the benefits stemming from the 'not so recent' amendments to the Value-Added Tax Act 89 of 1991, as applicable to fixed property acquired by a VAT vendor from a non-vendor on or after 10 January 2012.

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Varusha Moodaley

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Although old news to some, there still seems to be little awareness regarding the interplay between value-added tax ("VAT") and transfer duty, and the benefits stemming from the 'not so recent' amendments to the Value-Added Tax Act 89 of 1991 ("the VAT Act"), as applicable to fixed property acquired by a VAT vendor from a non-vendor on or after 10 January 2012.

Where fixed property is purchased by a VAT vendor from a non-vendor, transfer duty will be payable thereon by the purchaser. The purchasing VAT vendor will then be entitled to a notional input tax deduction to the extent that the property was purchased for the purpose of consumption, use or supply in the course of making taxable supplies.

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