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.
Purchase of earth moving equipment 2020-05-05 11:00 AHT23827
Appointment of a panel of electrical contractors (CIDB grade 3EP to 9 EP) to provide electrical construction services to the Alfred Duma Local Municipality for a period of one year 2020-04-16 11:00 EES 01/2020
Invitation for Service Providers to Provide Short Term Insurance for uMgungundlovu District Municipality 2020-04-23 12:00 09/2020
Supply and delivery of Refuse Skip Loader Truck for Makhado Local Municipality 2020-05-08 12:00 15 of 2020
Request for Proposals for the Placement on the Municipal Panel of Professional Civil, Structural, Mechanical and Electrical Engineering Consultants for a period of thirty-six (36) months 2020-04-24 12:00 UGU-07-1540-2020
Provision of Services: Taking of Water and Sewage Samples, Analysing, and Monitoring it in Botrivier, Caledon, Tesselaarsdal, Genadendal, Grabouw, Greyton, Riviersonderend and Villiersdorp for the Period From 01 July 2020 To 30 June 2023 2020-04-24 12:00 ENG 01/2020/21
Re-advert: Procurement of Service Provider for Enhancement of the APRM Electronic Questionnaire Tool for the African Peer Review Mechanism (APRM) 2020-04-28 11:00 APRM/001B/SIDA/EQT/2020
Supply and Installation of Artificial grass in various parks in Hermanus for a contract period ending 30 June 2020. 2020-04-03 12:00 SC2080/2020
Supply and Delivery of Sewing Equipment 2020-04-03 12:00 FWQ201/2019
Supply and Delivery of Cable 2020-04-03 12:00 FWQ204/2019
Supply and Delivery of Sewage Mixers 2020-05-08 12:00 FWQ207/2019
Supply and Delivery of a Soft Starter Water Pump Station Alwyndal 2020-05-08 12:00 FWQ208/2019
Installation of Perimeter Fence at Polokwane Traffic Station 2020-04-30 11:00 PUDP 758
Supply, Delivery and Installation of General Steelworks and Fittings 2020-04-30 12:00 TDR125/2019
Appointment of Contractors in the Built and Environment for construction Rivoni School for the blind for the Limpopo Department of Education 2020-04-30 11:00 LDE/IA/B18/2019/20
Supply and Delivery of Manhole Rings and Covers 2020-04-09 12:00 TDR120/2019
Supply and Delivery of Chemical Cleaning Product for use in the Wastewater Systems 2020-04-09 12:00 TDR121/2019
Supply and Delivery of a Cobra Safe MLP System with Various Components and Cobra Brass Fittings 2020-04-09 12:00 TDR123/2019
Appointment of panel of contractors for urban / rural stormwater maintenance 2020-05-04 12:00 13/2020
Supply and Delivery of Various Water Fittings 2020-04-09 12:00 TDR122/2019

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