Category: Section 1 (VAT) – Definitions

“Connected persons” definition of section 1 of VAT Act

Posted on by admin_kmos

“connected persons” means-

(a)     any natural person (including the estate of a natural person if such person is deceased or insolvent) and-

(i)      any relative of that natural person (being a relative as defined in section 1 of the Income Tax Act) or the estate of any such relative if the relative is deceased or insolvent; or

(ii)   any trust fund in respect of which any such relative or such estate of such relative is or may be a beneficiary; or

[Paragraph (a) substituted by section 22 of Act 97 of 1993]

(b)     any trust fund and any person who is or may be a beneficiary in respect of that fund; or

(c)     any partnership or close corporation and-

(i)      any member thereof; or

(ii)   any other person where that person and a member of such partnership or close corporation, as the case may be, are connected persons in terms of this definition; or

(d)     any company (other than a close corporation) and-

(i)      any person (other than a company) where that person, his spouse or minor child or any trust fund in respect of which that person, his spouse or minor child is or may be a beneficiary, is separately interested or two or more of them are in the aggregate interested in 10 per cent or more of the company’s paid-up capital or 10 per cent or more of the company’s equity shares (as defined in section 1 of the Income Tax Act) or 10 per cent or more of the voting rights of the shareholders of the company, whether directly or indirectly; or

[Subparagraph (i) substituted by section 165 of Act 31 of 2013 effective on 1 April 2012]

(ii)     any other company the shareholders in which are substantially the same persons as the shareholders in the first-mentioned company, or which is controlled by the same persons who control the first-mentioned company; or

[Subparagraph (ii) substituted by section 128 of Act 25 of 2015 effective on 1 April 2012 – Date of operation as in section 128 of Act 25 of 2015 as amended by section 106 of Act 15 of 2015]

(iii)    any person where that person and the person referred to in subparagraph (i) or his spouse or minor child or the trust fund referred to in that subparagraph or the other company referred to in subparagraph (ii) are connected persons in terms of this definition; or

(e)     any separate enterprise, branch or division of a vendor which is separately registered as a vendor under the provisions of section 50 and any other such enterprise, branch or division of the vendor; or

(f)     any branch, division or separate enterprise of an association not for gain which is deemed by subsection (5) of section 23 to be a separate person for the purposes of that section and any other branch, division or separate enterprise of that association, whether or not such other branch, division or separate enterprise is a vendor; or

[Paragraph (f) amended by section 23 of Act 27 of 1997]

(g)     any person and any superannuation scheme referred to in section 2(2)(vii), the members of which are mainly the employees or office holders or former employees or office holders of that person;

[Paragraph (g) added by section 23 of Act 27 of 1997]

“Consideration” definition of section 1 of VAT Act

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“consideration”, in relation to the supply of goods or services to any person, includes any payment made or to be made (including any deposit on any returnable container and tax), whether in money or otherwise, or any act or forbearance, whether or not voluntary, in respect of, in response to, or for the inducement of, the supply of any goods or services, whether by that person or by any other person, but does not include any payment made by any person as a donation to any association not for gain: Provided that a deposit (other than a deposit on a returnable container), whether refundable or not, given in respect of a supply of goods or services shall not be considered as payment made for the supply unless and until the supplier applies the deposit as consideration for the supply or such deposit is forfeited;

[Definition of “consideration” substituted by section 92 of Act 32 of 2004 and amended by section 8 of Act 10 of 2005 with effect from 24 January 2005]

“Customs controlled area” definition of section 1 of VAT Act

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“customs controlled area” has the meaning assigned thereto in section 21A(1) of the Customs and Excise Act;

[Definition of “customs controlled area” inserted by section 164 of Act 45 of 2003 and substituted by section 165 of Act 31 of 2013 and section 23 of Act 16 of 2016 effective on the date on which the Special Economic Zones Act, 2014 (Act No. 16 of 2014), came into operation, 9 February 2016]

“Customs controlled area enterprise” definition of section 1 of VAT Act

Posted on by admin_kmos

“customs controlled area enterprise” has the meaning assigned thereto in section 21A(1) of the Customs and Excise Act;

[Definition of “customs controlled area enterprise” inserted by section 164 of Act 45 of 2003 and substituted by section 165 of Act 31 of 2013 and section 23 of Act 16 of 2016 effective on the date on which the Special Economic Zones Act, 2014 (Act No. 16 of 2014), came into operation, 9 February 2016]

“Designated entity” definition of section 1 of VAT Act

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“designated entity” means a vendor-

(i)      to the extent that its supplies of goods and services of an activity carried on by that vendor are in terms of (b)(i) of the definition of ‘enterprise’ treated as supplies made in the course or furtherance of an enterprise;

(ii)    which is a major public entity, national government business enterprise or provincial government business enterprise listed in Schedule 2 or Part B or D of Schedule 3 of the Public Finance Management Act, 1999 (Act No. l of 1999), respectively;

[Paragraph (ii) amended by section 40 of Act 9 of 2006]

(iii)   which is a  party to a ‘Public Private Partnership Agreement’ as defined in Regulation 16 of the Treasury Regulations issued in terms of section 76 of the Public Finance Management  Act, 1999 (Act No. 1 of 1999), to the extent that that party supplies goods or services in terms of that Agreement to the ‘institution’ defined in that Regulation;

[Paragraph (iii) substituted by section 104 of Act 60 of 2008 and section 26 of Act 8 of 2010 effective on 2 November 2010]

(iv)    which is a welfare organisation;

[Paragraph (iv) amended by section 40 of Act 9 of 2006 and section 77 of Act 20 of 2006]

(v)     which is a municipal entity as defined in section 1 of the Local Government: Municipal Systems Act, 2000 (Act No. 32 of 2000); or

[Paragraph (v) added by section 40 of Act 9 of 2006 and amended by section 77 of Act 20 of 2006]

(vi)    which has powers similar to those of any water board listed in Part B of Schedule 3 of the Public Finance Management Act, 1999 (Act No. 1 of 1999), which would have complied with the definition of ‘local authority’ in section 1 prior to the deletion of that definition on 1 July 2006;

[Paragraph (vi) inserted by section 77 of Act 20 of 2006]

[Definition of “designated entity” inserted by section 164 of Act 45 of 2003]

“Domestic goods and services” definition of section 1 of VAT Act

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“domestic goods and services” means goods and services provided in any enterprise supplying commercial accommodation, including-

(a)     cleaning and maintenance;

(b)     electricity, gas, air conditioning or heating;

(c)     a telephone, television set, radio or other similar article;

(d)     furniture and other fittings;

(e)     meals;

(f)     laundry;

[Paragraph (f) amended by section 128 of Act 25 of 2015 effective on 1 April 2016]

(g)     nursing services; or

[Paragraph (g) amended by section 128 of Act 25 of 2015 effective on 1 April 2016]

(h)     water;

[Paragraph (h) added by section 128 of Act 25 of 2015 effective on 1 April 2016]

[Definition of “domestic goods and services” substituted by section 65 of Act 19 of 2001 and section 148 of Act 60 of 2001 and amended by section 92 of Act 32 of 2004]