Registering for VAT voluntarily in South Africa
When a small South African business may register for VAT before the compulsory threshold, the date registration applies from, and how to weigh it up.
By Achekam · · 4 min read · For Running a business businesses in South Africa
A young business supplies a few larger companies. Every one of them asks for its VAT number, and every quote it sends without VAT looks oddly incomplete beside its competitors'. Meanwhile it pays VAT on equipment, materials and rent that it cannot claim back. The owner starts to wonder whether registering early would help.
South Africa allows that. A business below the compulsory threshold can register voluntarily once its taxable supplies pass a lower test, and from 1 April 2026 that lower test changed. This article explains the tests, the date from which a voluntary registration applies, how to weigh the decision, and what to set up in your books once the VAT number arrives.
The R120 000 test
SARS's VAT page says the voluntary VAT registration threshold increased from R50 000 to R120 000 with effect from 1 April 2026.
SARS's registration page sets out the test: a person may register voluntarily if taxable supplies are below R2.3 million but have, under certain circumstances, exceeded R120 000 in the past 12 months. Above R2.3 million, registration is no longer voluntary; that side is covered in when a South African business must register for VAT.
There is a wrinkle. SARS notes that the Voluntary Registration Regulation has not yet been updated, but that it is administering applications on the increased threshold from 1 April 2026. So the law's own text lags behind SARS's practice for now.
These thresholds are as SARS published them at the time of writing. SARS's register for VAT page explains who may and who must register and what counts as an enterprise, and is the place to confirm the current tests.
The monthly-average route for a newer business
A business that has not yet traded for a year has a second way in. SARS says a person who has made taxable supplies for two months or more may register voluntarily where the average value of taxable supplies in the months before applying exceeded R4 200 per month, calculated over a minimum of 2 and a maximum of 11 months.
Look closely at that figure alongside the new threshold. The monthly average of R4 200 sits naturally with the old R50 000 annual threshold, not the new R120 000 one. Since SARS says the regulation has not yet been updated, ask SARS which monthly figure it is applying before you rely on this route.
The liability date: from the application
Timing matters more than many applicants expect. SARS says a voluntary VAT registration takes its liability date from the date of application, and cannot be backdated unless the applicant provides supporting documents to justify the backdating.
In practice:
- You start charging VAT and accounting as a vendor from the liability date, not from the day you first thought about registering.
- Invoices issued before that date were not tax invoices, and should not be treated as if they were.
- If you want an earlier date, prepare the supporting documents with the application, not afterwards.
Weighing it up
SARS explains the mechanism a vendor works under: it pays SARS the difference between output tax and input tax, or claims a refund where input tax exceeds output tax. Voluntary registration is a trade between the two sides of that sum.
| Consideration | Points towards registering | Points against |
|---|---|---|
| Your customers | Mostly VAT vendors who can claim the VAT you charge | Mostly the public, who will simply pay more |
| Your costs | High VAT-bearing purchases, equipment or rent | Few purchases that carry VAT |
| Your administration | Able to keep tax invoices and file returns on time | Little capacity for regular returns |
| Your sales | Some zero-rated sales, such as exports | Only exempt supplies, which SARS's VAT 404 guide says cannot be registered for |
A business selling mainly to other VAT vendors may find registration neutral for its customers and helpful for itself. One selling mainly to the public has to decide whether it can absorb the VAT or pass it on. A manufacturer weighing the input tax on raw materials will find the purchase side discussed in claiming input VAT on raw-material purchases. Micro businesses on turnover tax face a related choice, covered in staying VAT-registered on turnover tax.
Setting Achekam up once the VAT number arrives
Once SARS issues the number, your documents and books need to change from the liability date.
Firm profile. A business enters its VAT registration number in Settings under Firm Profile. Documents made by the server print it, and are titled Tax Invoice only when a VAT number is set. Enter the number as soon as registration takes effect, so the first invoice from that date is a proper tax invoice.
Invoice lines. A South African business sets each invoice line's VAT to 15% or 0%. The invoice screen does not tell zero-rated and exempt apart, so if you make zero-rated sales, keep your own note of which 0% lines they are.
Supplier bills. Supplier bills and purchase orders take 15% or 0% VAT per line, and bills post input VAT to the ledger. From the liability date, record supplier bills with the VAT shown on each tax invoice, so the input tax you are now entitled to reaches your books.
Making the decision
Add up your taxable supplies for the last 12 months, check them against R120 000, and list your main customers and your largest VAT-bearing costs. If the sums favour registering, apply with any backdating evidence ready, and set up Achekam on the day the registration takes effect.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
