No input tax deduction can be claimed unless the vendor is in possession of a compliant “tax invoice”. Having no tax invoice can result in a 25% penalty if detected by SARS.
There is much legislation in terms of what must appear on a tax invoice, when they must be issued, “copy tax invoices” and more. There are even criminal offences relating to a failure to issue tax invoices.
But, after 22 years of VAT, some still get it wrong. Recently, I have been struggling with VAT input deductions on my business expenses.
The South African Airways website is reliable and comprehensive tax invoices arrive every time. British Airways e-ticketing, however, has the facility to print a ticket, but not a tax invoice.
I have tried everything. No joy.
The only written explanation offered was “there is no VAT on air travel”. And when I got shirty, “we cannot deal with you any more”. So the VAT remains unclaimed.
The Tax Administration Act requires that books and records must be maintained for five years. So I do have some time to pursue a resolution. Or perhaps I should just change to other suppliers.
But I like flying BA. They offer whiskey. That is important to a hypertensive pre-diabetic-candidate alcoholic trying to get home after a long day fighting SARS.
Perhaps it should be a requirement that major suppliers publish separate contact details relating to VAT matters.
Originally published in the Sunday Times: Money & Careers Tax Talk column.