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Articoli Correlati: South Africa - telematic services - VAT

The National Treasury recently published an amendment to the Regulation for telematic services, in line with the proposal of the Minister of Finance. The new regulation came into force as of 1 April 2019 and provides for an increase in VAT. More specifically, foreign activities that provide telematic services are required to pay VAT when, for example: a threshold of R1 million is exceeded in a 12-month rolling period; the customer resides in South Africa; the customer has a postal, commercial or residence address; payment for these services is provided by a bank in South Africa.
The new Regulation provides for some important changes, including: the old list of services that also included online services has been modified and replaced by a new definition according to which telematic services means “any service involving an electronic agent, electronic communications or Internet”; there is a certain relief for B2B transactions (business to business, it means the exchange of information, products or services between activities or between activities and customers) which take the form of inter-group transactions, where the South African company is a wholly-owned subsidiary controlled by the foreign company (i.e. the provider of services abroad), these operations are excluded from the scope of the telematic services.