“input tax”, in relation to a vendor, means-

(a)     tax charged under section 7 and payable in terms of that section by-

(i)     a supplier on the supply of goods or services made by that supplier to the vendor; or

(ii)   the vendor on the importation of goods by that vendor; or

[Subparagraph (ii) substituted by section 19 of Act 44 of 2014 effective on 20 January 2015]

(iii)  the vendor under the provisions of section 7(3);

(b)     an amount equal to the tax fraction (being the tax fraction applicable at the time the supply is deemed to have taken place) of the lesser of any consideration in money given by the vendor for or the open market value of the supply (not being a taxable supply) to him by way of a sale on or after the commencement date by a resident of the Republic (other than a person or diplomatic or consular mission of a foreign country established in the Republic that was granted relief, by way of a refund of tax as contemplated in section 68) of any second-hand goods situated in the Republic;

[Paragraph (b) substituted by GN 2695 of 1991 and section 12 of Act 136 of 1992, amended by section 22 of Act 97 of 1993, substituted by section 9 of Act 20 of 1994 and amended by section 23 of Act 27 of 1997 and section 104 of Act 35 of 2007]

[Proviso to paragraph (b) deleted by section 129 of Act 24 of 2011 with effect from 10 January 2012]

(c)     an amount equal to the tax fraction of the consideration in money deemed by section 10(16) to be for the supply (not being a taxable supply) by a debtor to the vendor of goods repossessed under an instalment credit agreement or a surrender of goods: Provided that the tax fraction applicable under this paragraph shall be the tax fraction applicable at the time of supply of the goods to the debtor under such agreement as contemplated in section 9(3)(c),

[Words preceding the proviso substituted by section 165 of Act 31 of 2013 effective on 1 April 2014]

where the goods or services concerned are acquired by the vendor wholly for the purpose of consumption, use or supply in the course of making taxable supplies or, where the goods or services are acquired by the vendor partly for such purpose, to the extent (as determined in accordance with the provisions of section 17) that the goods or services concerned are acquired by the vendor for such purpose;

“instalment credit agreement” means any agreement entered into on or after the commencement date whereby any goods consisting of corporeal movable goods or of any machinery or plant, whether movable or immovable-

(a)     are supplied under a sale under which-

(i)      the goods are sold by the seller to the purchaser against payment by the purchaser to the seller of a stated or determinable sum of money at a stated or determinable future date or in whole or in part in instalments over a period in the future; and

(ii)     such sum of money includes finance charges, including any amount determined with reference to the time value of money, stipulated in the lease; and

[Subparagraph (ii) substituted by section 145 of Act 22 of 2012 effective on 1 January 2013]

(iii)  the aggregate of the amounts payable by the purchaser to the seller under such agreement exceeds the cash value of the supply; and

(iv)

(aa)   the purchaser does not become the owner of those goods merely by virtue of the delivery to or the use, possession or enjoyment by him thereof; or

(bb)   the seller is entitled to the return of those goods if the purchaser fails to comply with any term of that agreement; or

(b)     are supplied under a lease under which-

(i)      the rent consists of a stated or determinable sum of money payable at a stated or determinable future date or periodically in whole or in part in instalments over a period in the future; and

(ii)   such sum of money includes finance charges stipulated in the lease; and

(iii)    the aggregate of the amounts payable under such lease by the lessee to the lessor for the period of such lease (disregarding the right of any party thereto to terminate the lease before the end of such period) and any residual value of the leased goods on termination of the lease, as stipulated in the lease, exceeds the cash value of the supply; and

(iv)    the lessee is entitled to the possession, use or enjoyment of those goods for a period of at least 12 months; and

(v)

(aa)   the lessee accepts the full risk of destruction or loss of, or other disadvantage to, those goods and assumes all obligations of whatever nature arising in connection with the insurance, maintenance and repair of those goods while the agreement remains in force; or

(bb)

(A)    the lessor accepts the full risk of destruction or loss of, or other disadvantage to those goods and assumes all obligations of whatever nature arising in connection with the insurance of those goods; and

(B)    the lessee accepts the full risk of maintenance and repair of those goods and reimburses the lessor for the insurance of those goods,

while the agreement remains in force;

[Paragraph (b) substituted by section 145 of Act 22 of 2012 effective on 1 January 2013]