Section 40F (VAT) – Liability for tax and limitation of refunds in respect of National Housing Programmes

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40F.   Liability for tax and limitation of refunds in respect of National Housing Programmes

 

(1)     This section applies in respect of the supply of services deemed to be made by the vendor in terms of section 8(23), which services were supplied before 1 April 2026.

 

(2)     Where the Commissioner issued any assessment relating to tax periods ending before 1 April 2026 for an amount of tax or additional tax in respect of any supply of services as contemplated in subsection (1) in respect of application of the provisions as contemplated in section 11(2)(s) in respect of that supply, the Commissioner must, on written application by the vendor, amend that assessment to the extent that the amount of tax, additional tax, penalty or interest that arose as a result of that assessment has not yet been paid on that date: Provided that the assessment does not result in a refund to the vendor.

 

(3)      The Commissioner may not make any assessment for tax periods ending before 1 April 2026 in respect of the deemed supply of services contemplated in subsection (1).

 

(4)     If the vendor has charged tax at the rate referred to in section 7(1) instead of the rate of tax in terms of section 11(2)(s) in respect of the supply contemplated in subsection (1), the Commissioner may not refund any such tax or any penalty or interest that arose as a result of the late payment of such tax, paid by the vendor to the Commissioner.

[Section 40F inserted by section 45(1) of Act 5 of 2026 effective on 1 April, 2026]

Section 40E (VAT) – Liability for tax and limitation of refunds in respect of supplies by school

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40E.  Liability for tax and limitation of refunds in respect of supplies by school

 

(1)     This section applies in respect of the supply of services by a school contemplated in section 12(h)(ii) before 1 January 2026.

 

(2)     Where the Commissioner issued any assessment relating to tax periods ending before 1 January 2026 for an amount of tax or penalty in respect of any supply of services, as contemplated in subsection (1), in respect of the application of the provisions, as contemplated in section 12(h)(ii), in respect of that supply, the Commissioner must, on written application by the vendor, amend that assessment to the extent that the amount of tax, penalty or interest that arose as a result of that assessment, has not yet been paid on that date: Provided that the assessment does not result in a refund to the vendor.

 

(3)      The Commissioner may not make any assessment for tax periods ending before 1 January 2026 in respect of the supply of services contemplated in subsection (1).

 

(4)     If the vendor has charged tax at the rate referred to in section 7(1) in respect of the supply contemplated in subsection (1), the Commissioner may not refund any such tax, penalty or interest that arose as a result of the late payment to such tax, paid by the vendor to the Commissioner.

[Section 40E inserted by section 45(1) of Act 5 of 2026 effective on 1 January, 2026]

“Interoperability framework” definition of section 1 of VAT Act

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“interoperability framework” means the use of a network of service providers, where decentralised exchange of e-invoices, e-debit notes and e-credit notes occur, and that can facilitate clearance and interoperability between supplier and recipient, and complies with such further requirements as the Minister may prescribe by Regulation;

[Definition of “interoperability framework” inserted by section 11(c) of Act 4 of 2026]

“E-reporting” definition of section 1 of VAT Act

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“e-reporting” means the process of electronically submitting tax data, for purposes of this Act, extracted from an e-invoice, e-debit note, or e-credit note, to—


(a)     SARS;


(b)     a supplier or service provider of the supplier; and


(c)     a recipient or service provider of the recipient, where applicable,


within the interoperability framework in the form and manner as the Minister may prescribe by Regulation;

[Definition of “e-reporting” inserted by section 11(b) of Act 4 of 2026]

“E-invoice” definition of section 1 of VAT Act

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“e-invoice” means a tax invoice that-


(a)     is issued, transmitted and received in a structured electronic format which allows for its automatic and electronic processing; and


(b)     complies with such further requirements as the Minister may prescribe by Regulation;

[Definition of “e-invoice” inserted by section 11(a) of Act 4 of 2026]

“E-debit note” definition of section 1 of VAT Act

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“e-debit note”, means a debit note as contemplated in section 21, that-

 

(a)     is issued, transmitted and received in a structured electronic format which allows for its automatic and electronic processing; and

 

(b)     complies with such further requirements as the Minister may prescribe by Regulation;

[Definition of “e-debit note” inserted by section 11(a) of Act 4 of 2026]

“E-credit note” definition of section 1 of VAT Act

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“e-credit note” means a credit note as contemplated in section 21, that-

 

(a)     is issued, transmitted and received in a structured electronic format which allows for its automatic and electronic processing; and

 

(b)     complies with such further requirements as the Minister may prescribe by Regulation;

[Definition of “e-credit note” inserted by section 11(a) of Act 4 of 2026]

Paragraph 82A (Eighth Schedule) – Capital distributions by collective investment schemes

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82A.  Capital distributions by collective investment schemes


The distribution of any amount by a portfolio of a collective investment scheme, other than the distribution of an amount of gross income to a holder of a participatory interest in that portfolio, is treated as a capital gain for that holder of a participatory interest for the year of assessment in which that distribution accrues to that holder.

[Paragraph 82A inserted by section 34(1) of Act 5 of 2026 effective on 1 March, 2026 and applicable in respect of distributions made on or after that date]

“Motor vehicle manufacturer” definition of section 12V of ITA

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(5)     For the purpose of this section-


“motor vehicle manufacturer” means the manufacturer-


(a)     as determined by applying the criteria in paragraph (i) of the definition of “final manufacturer”, as defined in the regulations issued in terms of section 59 of the International Trade Administration Act, 2002 (Act 71 of 2002), contained in Government Notice No. R.80, as published in Government Gazette No. 44144 of 11 February 2021; or


(b)     of a “heavy motor vehicle”, as referred to in item 317.07 in Part I of Schedule No. 3 to the Customs and Excise Act, 1964 (Act 91 of 1964), to the extent of assembly provided for in Note 5 to Chapter 98 of Part 1 of Schedule No. 1 to that Act.

[Section 12V inserted by section 12(1) of Act 42 of 2024 effective on 1 March, 2026 and applicable in respect of assets brought into use on or after that date. Subsection (5) added by section 16(1) of Act 5 of 2026 effective on 1 March, 2026 and applicable in respect of assets brought into use on or after that date]