If you are registered as a VAT vendor you will have to submit a return and pay the VAT over to the SARS every few months depending on the category that the business falls into.

The owner of the business must calculate how much VAT is owed to SARS. A standard VAT return must be submitted on e-Filing by the end of the month following the VAT period. The return form is VAT 201. SARS will impose penalties and interest for people who submit their returns late. Penalties are 10% of the amount that is owed and interest is charged at the standard interest rates.

Businesses have to pay VAT on goods or services if they have invoiced customers. This is called paying VAT on an invoice basis. It means that if the owner of the business invoices customers, the owner has to pay over the VAT to SARS even if the customer has not yet paid. This could cause cash flow problems for the business.

The owner of the business can do three things:

• Apply to SARS in writing to pay VAT on a payments basis. This means that you only pay VAT to SARS when your customers have paid.
• Ask customers to pay their account immediately when they buy the goods or when they receive the service.
• Charge customers interest if they do not pay your invoices within 30 days.