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Have you registered your business for Value Added Tax (VAT) yet?

Value Added Tax was implemented on January 1, 2013 and all businesses making taxable supplies and an annual turnover of over SR5 million had to register for VAT. Others could register on a voluntary basis if they wished to do so. To date there are 634 businesses registered for VAT (426 compulsory and 208 voluntary). Next year this figure is expected to go up as more businesses will fall under the VAT threshold. As announced by the Minister for Finance, Trade and Investment in his budget speech for 2013 the VAT threshold will be reduced to SR 3 million in 2014.

The Seychelles Revenue Commission would like to inform all businesses not yet registered for VAT that the VAT registration process has started. A letter and a VAT registration form have been sent to those businesses registered with SRC but not yet registered for VAT, as well as to those currently registered on a voluntary basis but will as of 1 January 2014 be registered on a compulsory basis for them to confirm their VAT registration status.

How do businesses confirm their VAT registration status?
Businesses need to confirm their VAT registration status by completing the VAT registration form. The form can be downloaded here , be collected from any SRC’s offices on Mahe, Praslin and La Digue or can be sent by e-mail upon request for those businesses that did not receive it.

On the form, YES or NO must be ticked when asked if the business:
  • makes taxable supplies;
  • annual turnover for 2012 exceeds SR3 million;
  • annual turnover for 2013 has or is expected to exceed SR 3 million;
  • chooses to be registered on a voluntary basis if the business’ annual turnover has not exceeded and is not expected to exceed SR 3 million.
The completed the form needs to be signed and returned to SRC. It is important that businesses register early so that they SRC can properly educate them on how the VAT system works for their business.

How to determine whether a business makes taxable supplies?
Only a business making taxable supplies can register for VAT. A business makes taxable supplies when it sells a good or provides a service which is taxable under the VAT Act 2010 and its subsequent Statutory Instruments (SI). To determine if a supply is taxable, refer to the exemption list in Schedule 1 (Part II) of the VAT Act 2010 and SI 65 of 2012 - Value Added Tax (Amendment of Schedules) Regulations, 2012. These can be found here. The business IS NOT making taxable supplies if it sells goods or provides services which are specifically VAT exempted. If in doubt or for further clarification, please call SRC on 4293741/4293742/4293745.

What happens if a business which is required to register for VAT fails to do so?
As of 1 January 2014 it will be compulsory for businesses that fall under the SR 3 million threshold to register for VAT. Businesses failing to register by then will be automatically registered by SRC as per the the VAT Act 2010 (Section 8, Part2) and will have to pay VAT from the date that it should have been registered in the event that SRC received information that it should have been registered.

What are the obligations of a VAT registered business?
VAT registered business must:
  • charge and collect the correct amount of VAT on all your taxable supplies;
  • Issue a proper VAT invoice for all its sale;
  • Lodge a monthly (for compulsory registrants) or quarterly (for voluntary registrants) VAT return to SRC and remit the VAT collected along with the return;
  • Keep proper records of the business transactions;
  • Display the original copy of the VAT registration certificate in a prominent location within the principal place of business and certified copies of the certificate at all the other places of business; and
  • Notify SRC in writing of any changes in name (including business name), address, place of business or nature of the business within 21 days of the changes having been made.
VAT registered retailers must also have a proper Point of Sales (POS) system or cash register machine.

For more information
You can contact Seychelles Revenue Commission on 4293745 or email us at advisory.center@src.gov.sc, visit one of our offices or visit our website (www.src.gov.sc).

Website Published Date: 4th December 2013

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