VAT L1 recap

A registered vendor buys trading stock for R345 (VAT inclusive).

What amount should be deducted in terms of s11(a) of the ITA?

• R345

• R300

• R45

• R397

A registered vendor buys a machine for R400 000 (VAT exclusive). 

What is the machine’s cost (on what value will W&T be calculated)?

• R400 000

• R347 826

• R460 000

True or False

VAT distinguish between income and capital in nature in order to consider whether input tax can be claimed

• True

• False

A registered vendor buys new office furniture for R225 from a non-vendor.

The wear and tear allowance is R225 in the yoa it was purchased, why?

• The asset was bought from a non-vendor (therefore VAT was not levied by the seller, no input can be claimed)and

• The asset is less than R7 000 therefore the full amount will qualify under s11(e)

• The asset will qualify for a full deduction under section 11(a)

A registered vendor buys new office furniture for R225 from a non-vendor.

The wear and tear allowance is R225 in the yoa it was purchased.

Will the answer be different if it is second-hand furniture from a non-vendor?

• Yes, I am confident I know the reason why

• Yes, but I am not sure why

• No, I don't think so

• No, I am confident I know the reason why

The following are taxable supplies

• Supplies at standard rate

• Supplies at zero rate

• Exempt supplies

s23 of the VAT Act deals with both compulsory and voluntary registration requirements

• True

• False