Guide to investing in South Africa
The principal source of indirect taxation revenue in South Africa is VAT. The standard rate of VAT is 14%.

Exports, certain foodstuffs and other supplies are zero-rated, and certain supplies are exempt (mainly certain financial services, residential accommodation and public transport). Any person that carries on an “enterprise” in South Africa for VAT purposes and that makes taxable supplies above a certain threshold is obliged to register as a VAT vendor.

Investment in South Africa, both by a branch or through a subsidiary, will constitute an “enterprise” and will therefore require VAT registration. VAT (output tax) is levied at 14% on the value of any supplies made by a vendor, unless such supplies qualify for a zero rating (for example, supplies physically rendered outside of South Africa are subject to VAT at the zero rate) or are exempt from VAT. Any VAT charged to the vendor by suppliers, as well as VAT levied on the importation of goods, will generally be deductible as an input tax credit by the vendor.