VAT Registration in South Africa 2026

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The 2026 change, first

From 1 April 2026, compulsory VAT registration applies once your taxable supplies exceed R2.3 million in any consecutive 12-month period — up from the R1 million threshold that had stood for years. The voluntary registration floor also moved, from R50,000 to R120,000. Any article, forum answer or accountant's website still quoting R1 million is out of date.

When registration is compulsory

You must register when your taxable supplies pass R2.3 million over any rolling 12 months — not your financial year, any 12 months — or when you have a contractual commitment that will take you over it. You have 21 business days to apply once you cross the line. Register late and SARS can backdate your registration, meaning you owe output VAT on sales you never charged VAT on, plus penalties and interest. That's the expensive way to learn the rule.

When voluntary registration makes sense

From R120,000 of taxable supplies you can register by choice. The logic is simple: if your customers are mostly VAT vendors themselves, the VAT you charge costs them nothing (they claim it back), while registration lets you reclaim VAT on your own costs — equipment, rent, software, fuel. If your customers are mostly consumers, adding 15% makes you more expensive or squeezes your margin. Business-to-business: usually register. Business-to-consumer: usually wait.

What changes when you're a vendor

You charge 15% output VAT on taxable supplies, claim input VAT on business costs (with valid tax invoices — keep them), and file a VAT201 return for each period, typically every two months, due by the 25th (later on eFiling). Your invoices must meet SARS's tax invoice requirements, and your bookkeeping needs to be genuinely current, because VAT is where messy books turn into real penalties fastest.

Common traps

Claiming input VAT without valid tax invoices. Missing the 21-business-day registration window. Charging VAT before your registration is effective. Forgetting that the rolling 12-month test can be crossed mid-year even when each financial year stays under the line. All avoidable with someone watching the numbers monthly — which is rather the point of having us.

Frequently asked questions

Common questions

What counts as taxable supplies?

Broadly, the goods and services your business sells that aren't exempt — including zero-rated exports and certain foodstuffs, which count toward the threshold even though the VAT rate on them is 0%. Exempt supplies (like residential rental income and most financial services) don't count.

How do I actually register?

Through SARS eFiling, with supporting documents — CIPC registration, proof of address, bank details and evidence of trading or taxable supplies. We prepare and submit the application and handle SARS's queries, which is where most DIY applications stall.

Can I deregister now the threshold is higher?

If your taxable supplies are under R2.3 million you can apply to deregister — but watch the exit VAT: deregistering can trigger output VAT on assets you hold. And if your customers are vendors, staying registered may still be the better deal. Model before moving.

How often are VAT returns due?

Most vendors file every two months, due the 25th after the period ends (with extra time on eFiling). High-volume vendors file monthly, and some smaller categories less often. Miss a filing and penalties plus interest apply automatically.

VAT registration in South Africa: the 2026 guide