Often, goods and services that are zero-rated are those that are considered necessary, such as food items, sanitary products, and animal feeds. Examples of zero-rated goods include certain foods and beverages, exported goods, equipment for the disabled, prescription medications, water, and sewage services.
What items are zero rated for VAT in South Africa?
The VAT Act provides for the supply of certain so-called basic foodstuffs to be zero rated.
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The list of zero rated items includes the following items:
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The list of zero rated items includes the following items:
- brown bread.
- dried mealies.
- dried beans.
- lentils.
- pilchards or sardinella in tins or cans.
- rice.
- fresh fruit and vegetables.
- vegetable oil.
What are exempt and zero rated items?
All inventory sales qualify as zero-rated supplies. Exempt supplies are not subject to VAT. No output VAT, either at 14% or at 0%, is levied on exempt supplies. Input VAT incurred on expenses to make exempt supplies cannot be claimed against output VAT due to SARS.
