n IMFO : Official Journal of the Institute of Municipal Finance Officers - VAT - treatment of grants

Volume 5, Issue 4
  • ISSN : 1607-520X



Extracted from text ... IMFO ? Winter 05 16 The uncertainty around what exactly constitutes a "transfer payment" has led to many a dispute between local authorities and the South African Revenue Service ("SARS"). More than one local authority has had the unpleasant experience of being informed by SARS auditors that what they have been treating as transfer payments were in fact consideration for actual services rendered and as such, subject to VAT at the standard rate. Payments that have proven to be prime targets during SARS inspections include the so-called NER grants, district municipality subsidies, SETA grants and equitable share allocations. The ..

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