Page 36 - F6 Slide - VAT Part 3 - Lecture Day 5

Example

Venter and Naidoo CC purchased a house from a non-

vendor (South African resident) for a consideration equal to

the open-market value of R350 000 (they are not connected

persons). Venter and Naidoo CC will use the house for the

purposes of making taxable supplies. As the value of the

fixed property is below R600 000, no transfer duty is

payable on the transfer of the fixed property. The

registration of the property in the name of Venter and

Naidoo CC occurred on 15 April 2014. Venter and Naidoo CC

borrowed money from ABC Bank and paid the full R350 000

to the non-vendor on 20 March 2014.

Determine when and to what extent input tax may be

claimed in respect of the purchase of the house. Take note

that the CC is registered on the invoice basis.