Issue Date: 
Thursday, October 31, 2019

Tax Clearance Certificates and VAT in the tender process

By Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.

The Preferential Procurement Policy Framework Act dictates that Organs of State enforce certain minimum requirements when awarding tenders, to verify that an enterprise is legally operating and is tax compliantOne of these are a tax clearance certificate.  Your business must be registered with SARS for Income Tax purposes if you want to tender.

To be registered for VAT, however, is not compulsory.  You will find that once you start selling your product or service, your customers are going to ask you for a Tax Invoice.  This is where the fun starts.  If you are registered for Value Added Tax or VAT in short, there would be no problem to supply your customers with a tax invoice, but if you are not registered for VAT this is where it becomes tricky. 

The South African public and business folk are so brain washed on a Tax Invoice that hardly anyone knows what a Tax Invoice is.  All they know is that their Auditors demand a Tax Invoice and if they cannot supply a Tax Invoice to the Auditors they are in trouble.  A Tax Invoice can only be issued by a business or vendor that is registered for VAT. 

There are several instances where a business or vendor can register for VAT, but the number one requirement is if the turnover of the business exceeds R1 million per year.

To learn more about this and many other tender conditions attend our “Become a Tender Expert” 2-Day workshops presented in Johannesburg, Pretoria, Durban, Port Elizabeth, and Cape Town.  Book and pay online at https://howtotender.co.za/tender-expert-form/

Contact us at wernervr@howtotender.co.za should you require more information.

You can also purchase a Tender Manual (Handbook) on our website https://howtotender.co.za/ which is a step by step guide how to respond to a South African Tender.  It includes examples of completed SBD forms.

Title Closing Date Tender No.
Repairing of potholes in Ward 5 2019-12-19 12:00 138/2019/20
Repairing of potholes in Ward 4 2019-12-19 12:00 139/2019/20
Repairing of potholes in Ward 2 2019-12-19 12:00 140/2019/20
Repairing of potholes in Ward 1 2019-12-19 12:00 141/2019/20
Bidders are invited for Collection, Conveyance and Deposit of Cash for the period of 36 months. 2020-01-17 12:00 LIM473/cashcollection/19/20/26
Expression of Interest for Hotel and Conference Facility Development and Operations in Steve Tshwete Municipality - Middelburg Mpumalanga 2020-01-08 12:00 BS05/11/2019
For the supply and delivery of a new white 26 seater minibus 2019-12-19 16:00 ITB/RSA/SU/12.03/2019
Supply and Delivery of Plumbing Fittings 2019-12-17 11:00 303133
Electrical Maintenance and Fault Findings For Breede Valley Municipality’s wwtw’s and Pumpstations 2019-12-17 11:00 303281
Supply, Delivery and Installation of Air Conditioners at Worcester wwtw 2019-12-17 11:00 301985
Stripping, Repair and Reassemble of 4 Robot Submersible Pumps and 1 X 15 Kw Electrical Motor at Worcester Wastewater Treatment Works. 2019-12-17 11:00 303274
Supply and Delivery Cable 300mm Single Core 2019-12-17 11:00 303241
Supply and Delivery of Electrical Fittings 2019-12-17 11:00 303243
Supply and Delivery of Office Furniture 2019-12-19 11:00 303296
Supply and Installation of Control Equipment and Office Furniture for Oyama and Tshepiso Dreamweaver 2019-12-13 12:00 RFQ/LED/2019-20/249
Service Provider to Supply and Deliver a Fruit Juice Production Equipment 2019-12-13 12:00 RFQ/LED/2019-20/248
First Aid Level 3 Training Programme 2019-12-13 12:00 RFQ/DHR/2019-20/247
Supply and Delivery Of 30 X Size 315/80r22.5 Stock Retreads For Coastal Solid Waste Vehicles 2019-12-13 12:00 RFQ/DIS/2019-20/246
Supply and Delivery of a Portable Breathing Air Compressor 2019-12-20 12:00 RFQ/HPS/2019-20/252
Supply and Delivery of Firefighting Hoses Complete 2019-12-20 12:00 RFQ/HPS/2019-20/251

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