VAT stands for Value-added Tax, which is an indirect tax on the consumption of goods and services in South Africa. To raise revenue for the government, certain businesses must register for VAT and charge it on their taxable supplies. VAT registration can benefit businesses by allowing them to claim input tax credits on their purchases. Additionally, once registered, businesses must comply with various regulations regarding record-keeping, invoicing, and reporting.

Any person doing business in South Africa, including individuals, partnerships, and companies, can register for VAT. VAT registration is mandatory if your entity's turnover exceeds R1 million over a consecutive 12-month period. VAT registration offers benefits such as enabling your entity to claim input tax credits on purchases, improving its credibility with customers and suppliers, and enhancing its ability to compete in the market.