VAT Zero-rated and Exempt Supplies

Zero-rated supplies

A fairly wide range of basic foodstuffs together with diesel, petrol and illuminating paraffin are zero-rated as distinct from exempt. This means that the customer pays no VAT, but the supplier can, if VAT registered, claim input VAT because they are making VATable supplies (albeit at a rate of zero). Exports are also zero-rated.

If a business is sold as a going concern by a VAT registered vendor to another VAT registered vendor along with the assets necessary for the business to continue as a going concern and as long as a number of conditions are complied with, the transaction is zero rated. It is critical that the contract of sale be drawn up by someone, such as Harbour and Associates, who is completely familiar with the requirements to qualify as zero rated.

Most fee-based financial services are subject to VAT, so your bank charges, for instance will have claimable VAT added.

Exempt supplies

Certain supplies are exempt from VAT. Most notable amongst these is rental of residential property.

A supplier of exempt goods or services is not allowed to claim input VAT in relation to the input side of those supplies.

We can register your company for VAT, or even supply a shelf company that is already VAT registered. We can also submit your VAT returns.

Should you wish to make an appointment, please feel free to visit Derek's diary and book a time that suits you.


Need a shelf company or CC, a tax clearance, VAT registration or B-BBEE certificate? We offer a wide range of such services.


South African Institute of Chartered Accountants. Designation CA(SA)  Internationally Accredited Financial MediatorsIndependent Regulatory Board for Auditors. Designation RA<Engineering Council of South Africa. Designation Pr(Eng) Member of MENSA, the High IQ Society




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