Be clever

get VAT wise

1
Guide for
Vendors

Republic of Namibia

Ministry of Finance
January 2011
 Value added tax

guide for vendors

( evised January 2011)

Part 1 Basic Information

Contents

Introduction i

Offices of Receivers of Revenue i

1. What is VAT? 1

2. What are taxable supplies and the different rates of VAT? 1

3. What are exempt supplies? 2

4. How does VAT work? 2

5. How do I register? 3

6. When do I get my registration number? 3

7. What about tax I paid before I registered? 3

S. When do I start to charge VAT? 3

9. What records do I need to keep? 4

10. What about my VAT returns? 4

11. What if my registration details change? 5

Part 2 – Supplementary Information

Contents

Appeals
Assessments
Business and non-business
Consignment Agents
Construction industry
Credit agreements
Credit and debit notes
Discounts
Exports
Imports
Input tax – other rules
Interest
Lay-byes
Local authorities
Objections
Offences
Penalties
Prices (tax-inclusive)
Record-keeping
Refunds
Tax periods and tax returns
Transfer of a going concern
Value of a supply
VAT invoices
Vehicles
Voluntary registration
Vouchers
Introduction

This guide has been written to assist you to understand how Value Added Tax (VAT) will
work in Namibia. It will help you decide whether or not you should apply for VAT registration
of your enterprise. If you are registered, it will outline your responsibilities to keep proper
records and account for VAT to the authorities.

However, this guide is not a substitute for the law, which is contained in the VAT Act No. 10
of 2000. If there appears to be any conflict between this guide and the Act, then the law must
be taken as the correct version. This guide has been drawn up on the basis of the VAT laws
existing at the time of printing.

If, after reading this leaflet, you are still unsure about whether you should apply for registration.
or any other aspect of VAT, you can get more help and information by telephoning, writing
to or visiting the office of the Receiver of Revenue - ask for the Customer Care Centre.
Addresses and telephone numbers are given below.

Remember, it is your responsibility to apply for registration for VAT if your business is
registrable. There are penalties for failure to register, and you will have to pay any VAT
due from the date when you should have registered - whether you have collected tax
from your customers or not.

Offices of Receivers of Revenue

Inland Revenue, Windhoek. Private Bag 13185

Telephone: (061) 2099111 Fax: (061) 231177

Otjiwarongo. P O Box 2127

Telephone: (067) 303279 Fax: (067) 303862

Keetmanshoop. P O Box 451

Telephone: (063) 224864 Fax: (063) 224863

i
 Inland Revenue. Walvis Bay. Private Bag 5027
Telephone: (064) 204285 Fax: (064) 204307

Inland Revenue. Oshakati. Private Bag 5548

Telephone: (065) 221181 Fax: (065) 221190

Inland Revenue. Rundu. Private Bag 2117

Telephone: (067) 256500 Fax: (067) 256546

ii
1. What is VAT?

Value Added Tax is a tax which registered businesses charge when they supply taxable goods
and services in Namibia.

It is also charged on goods and services that are imported into Namibia.

2. What are taxable supplies and the different rates of VAT?

Taxable supplies are goods and services which are subject to VAT at either the standard
rate (15%) or zero rate (0%). The total value of these supplies is called your “taxable
turnover”.

These are some examples of standard rate taxable supplies:

• selling new or used goods, including sales on credit;
• renting and hiring of goods;
• using business stock for private reasons;
• providing a service, such as hairdressing;
• charging an admission price;
• Self - employed people providing goods or services, including some salesmen and
subcontractors.

These are some examples of zero rate taxable supplies:

• mahango and maize meal;
• exports;
• goods subject to fuel levy.

(For a full list of zero-rate supplies, see Schedule III of the VAT Act 2000).

Taxable activities do not include:

• working as an employee for salaries or wages;
• hobbies or any private recreational pursuit;
• private sales of personal or domestic items;
• making exempt supplies.

1
 (More information is included in Part 2, Supplementary Information under “Business and
non-business”)
All types of supply are taxable unless they are exempt from VAT and listed in Schedule IV
of the VAT Act 2000.

3. What are exempt supplies?

Exempt supplies are business supplies which have no VAT charged on them at either the
standard, or zero rate. Therefore, they are not part of your taxable turnover. If you only make
exempt supplies, you will not be registered for VAT.

These are some examples of exempt supplies:

• some financial services, such as long term insurance;
• education services.

(For a full list, see Schedule IV of the VAT Act 2000).

4. How does VAT work?

If you are in business and your taxable turnover (excluding VAT), not your profit goes
over (or is likely to go over) N$200 000 in any period of 12 months you become a “taxable
person”. You must then apply for VAT registration.

If you are registered or need to be registered, you must account for VAT whenever you supply
any goods or services that are taxed at the standard rate. These supplies are your outputs and
the tax you charge is your output tax. Your purchases are called inputs, and the VAT which
other businesses charge you is called input tax. When you receive a VAT return, you deduct
your input tax from your output tax and pay what’s left to the Directorate Inland Revenue.
If your input tax is greater than your output tax you can claim a credit of VAT when you
complete your next VAT return.

If you are not liable to be registered because your taxable turnover is below N$200 000, you
will not be able to claim any credit of input tax. If you feel that you have a genuine need for

2
VAT registration even although your taxable turnover is below NS200 000 (this is known as
voluntary registration), you should make enquiries at the office of the Receiver of Revenue.

5. How do I register?

You must complete form VAT I. Send the completed form, with any other information we
have asked for, to the Receiver of Revenue (in which jurisdiction your activity is conducted)
at the addresses given on the first page of this leaflet. Keep a copy for your own records. Don’t
delay in sending off the form. If you do not tell us you should be registered you may have to
account for tax you have not collected from your customers, and pay a penalty for failure to
register. If you are not sure, don’t guess - ask for advice from the Customer Care Centre at the
office of the Receiver of Revenue.

6. When do I get my registration number?

The Receiver’s office will tell you when you are registered once they have checked the details
on your application form. You will receive a letter of registration. If you do not receive a
response within three weeks of sending in your form, contact the office to make sure they
received your application.

7. What about tax I paid before I registered?

You will be allowed to claim (as input tax) any VAT which you have paid on goods on hand
on the effective date of registration. This does not include goods purchased or imported
more than 4 months before your date of VAT registration. You must retain documentary
evidence (tax invoices and customs entries) that you paid VAT.

8. When do I start to charge VAT?

If you need to be registered you should start keeping records and charging VAT to your
customers from the date you are effectively registered.

3
 9. What records do I need to keep?

(For more details, see Part 2, Supplementary Information).

You must keep records of all your business supplies - including a record of all you have
bought and sold, and any goods which you have taken for your own use. You must also keep a
record of all the VAT you have charged and paid for each period covered by your VAT returns
- this is called a VAT account. If you are already in business, you will probably find that you
can use your normal business records to give this information. Shortly after you are registered,
you may receive an advisory visit from a VAT officer, who will give you guidance on how to
adapt your records for VAT, if necessary.

10. What about my VAT returns?

Most registered taxpayers will receive a VAT return at the end of every two calendar months.
This is called a tax period. The only exception is for taxpayers whose taxable activities are
farming activities - their tax period is 2, 4, 6 or 12 calendar months.

Your VAT return and tax due must reach the Receiver of Revenue by the 25th day of the
month following the end of your tax period. There are penalties for late filing of VAT returns
or payment of VAT.

The output tax which you show on your VAT return must includeVAT charged by you on all
your taxable supplies during the tax period - whether you have received payment or not. It
must also include VAT on the value (at cost price) of any goods taken from stock for the use
of yourself, your family or friends, etc.

If you have a retail business, and include VAT in your selling prices, you can calculate the
output tax by multiplying the total value of your taxable sales for the period by the rate of
VAT, and dividing the answer by 100 + the rate of VAT.

For example, for the standard rate of VAT (15%), the fraction is 15/I15.

4
So, if your sales total for the tax period was N$ 115 000 (including VAT), and all your sales
were taxable at the standard rate of 15%, your output tax would be:

N$ l15 000 x 15/115 = N$ 15 000

The input tax total will include VAT on all purchases for the business - as long as you
have proof that you were charged VAT, such as a tax invoice, or customs entry (for imported
goods). However, there are a few categories on which you are not allowed to claim input tax
– including passenger vehicles, (unless you are in the business of dealing in or hiring such
vehicles, a tour operator, a vehicle acquire by a short-term insurer to indemnify an insured
person under a short-term insurance contract or the vehicle was acquired by any charitable
organisation, children’s home, old-age home or orphanage), and business entertainment. More
details of these “non-deductible inputs” may be found in Part 2 of this leaflet, in Section 19
of the VAT Act, or obtained from the Receiver’s Office.

11. What if my registration details change?

After you have been registered, you must report (within 21 days) any changes in your
business which may affect your registration details. This includes change of name or address,
or if you cease to trade, or sell your business. More details are given in the VAT leaflet
“Changes in Business Circumstances”, which is available from Receivers’ offices.

5
 Part 2 - Supplementary Information

Contents

Appeals
Assessments
Business and non-business
Construction industry
Consignment Agents
Credit agreements
Credit and debit notes
Discounts
Exports
Imports
Input tax - other rules
Interest
Lay-byes
Local authorities
Objections
Offences
Penalties
Prices (tax-inclusive)
Record-keeping
Refunds
Tax periods and tax returns
Transfer of a going concern
Value of a supply
VAT invoices
Vehicles
Voluntary registration
Vouchers

6
Appeals (See also “Objections”)

(See Sections 28 and 29 of the VA T Act 2000)

If a registered person has objected to a decision by the Commissioner, and this objection has
been refused, he may lodge with the Commissioner a notice of appeal to the special court
within 60 days of the objection decision.
Lodging an appeal does not alter the obligation of a registered person to pay any tax due, but
if the appeal decision alters any assessment, any amount paid in excess will be refunded with
interest.

The burden of proving that an assessment is excessive, or that an official decision is wrong,
is on the person objecting.

Assessments

(See Sections 25 and 26 of the VAT Act 2000)

An assessment of tax may be raised by the Inland Revenue Department in the following
circumstances:

• where any person fails to furnish a return or an import declaration;

• where a return or import declaration is unsatisfactory;
• there is reason to believe a person is liable to pay tax, but has not done so;
• an unregistered person supplies goods or services, and represents that tax is charged upon
the supply;
• a registered person supplies non-taxable or zero-rated goods or services, and represents
that tax is charged upon the supply;
• where any person entered into any scheme to obtain a tax benefit.

Business and non-business

(See Section 4 of the VAT Act 2000)

7
 It is very important to understand the difference between business and non-business
activities:
• you must account for VAT on all the taxable supplies you make by way of business - not
just things you do in the course of your usual business activities; but
• if you also carry out non-business activities, it could affect the amount of VAT you can
reclaim as input tax. VAT charged on goods and services which you do not obtain for your
business is not input tax and you cannot reclaim it.
• If you have no business activities, you cannot be registered for VAT.

(a) Business. As far as VAT is concerned, business means any continuing activity which is
mainly concerned with making supplies to other persons for a consideration (i.e. payment in
some form). The activity must have a degree of frequency and scale and be continued over
a period of time - isolated transactions by unregistered persons are not normally considered
business for VAT purposes.

(b) Non-business. If you have any non-business activities, you will not be able to reclaim
all the VAT you are charged on your purchases. Examples of non-business activities include
private and personal activities, such as hobbies. You cannot reclaim VAT on purchases of
goods or services:
• for your private use
• supplied to you for another person’s business
• supplied to someone else - even if you pay for them
• supplied to your business, but for use in a non-business activity.

Some goods and services may be used for only partly business purposes e.g.
• telephone services
• repairs, maintenance, furnishing, etc., if a building is used for both business and personal
or other non ¬business use - for example, if you carry on a business from home or live
above your shop.

In these cases, you cannot reclaim as input tax all the VAT you have been charged - you must
apportion it in a fair and reasonable manner. If you are unsure what to do, seek guidance from
the Customer Care Centre.

8
Consignment agents

Namibian consignment agents registered for VAT pay import VAT on consignment goods sent
by a foreign principal (using a VAT Import Account, if they have one) and reclaim this as input
tax. They should then issue a tax invoice when the goods are sold to the customer in Namibia,
and account for output tax.
If the foreign principal has a branch in Namibia, this branch may register for VAT and use a
VAT Import Account.

Agents should remember that they must charge VAT at standard rate on their consignment
commission.

If the ultimate customer (for non-consignment goods) is known at the time of import, then that
customer should account for import VAT.

Construction industry

(See Section 7(13) and 79(5) of the VAT Act 2000)

The time of supply of any goods or services supplied directly in the construction etc. industry,
where the consideration becomes due and payable in installments or periodically, occurs at the
time payment becomes due, is received, or any invoice is issued, whichever is the earlier.

The service of a building contractor are liable to VAT at standard rate if the supply is for
commercial purposes; and at zero rate if the supply is for residential purposes.

The erection of a building, (or making additions or improvements to a building by a property

developer, or the owner of the land or buildings is a supply as far as VAT is concerned and
therefore the property developer can reclaim as input tax the VAT charged to him (e.g. By the
building contractor or materials suppliers). This applies even if the developer intends to rent
out the building as commercial property – which is a taxable supply.

The sale of land and building, or both is also a supply for VAT purposes.

9
 Civil engineering work is taxable at standard rate. The client for whom the work is performed
can only reclaim the VAT as input tax if the work is done “directly connected with the making
of taxable supplies” by the client (see section 19 (3) (a) of the VAT Act. 2000). For example, if
Nampower appoints a civil engineering firm to build a bridge to carry electric cables, this is in
the furtherance of a taxable activity (selling electricity), and Nampower can reclaim input tax.
However, if a local authority has a road built, this is “directly connected with the making of
exempt supplies” (section 19 (3) (b) } because the local authority levies taxes – not a taxable
supply {section 4 (1) (b) (v) } – and therefore cannot reclaim input tax.

Credit agreements

(See Sections 1, 7(4) &(5), 7(8), and 8(5) - (7) of the VAT Act 2000)

A credit agreement is defined as an “installments sale transaction” under section 1 of the

Credit Agreements Act, 1980 or a financial lease. The time of supply occurs on the day after
the receiver of credit may exercise the right to terminate the agreement. The value of a supply
of goods under a credit agreement is the cash value of the supply. If goods are repossessed
under a credit agreement, a supply of goods occurs at the time of repossession. The value of
the supply is the balance of the cash value, which has not been recovered.

Credit and debit notes

(See Section 22 and Schedule VI of the VAT Act 2000)

Similar requirements apply to credit and debit note as to tax invoices. In addition, credit and
debit notes must show:
• the amended value of the supply,
• the difference between the original and amended value,
• the tax charged which relates to the difference,
• a brief explanation of the circumstances, and
• sufficient information to identify the original taxable supply.

10
Discounts

(See definition of “consideration” in Section 1, and Section 20(1)(c) of the VAT Act 2000)

The consideration (value) of a supply or import of goods or services may be reduced by any
price discounts or rebates allowed and accounted for at the time of the supply or import.

Settlement discounts – when a registered enterprise grants settlement discounts for prompt
payment, a tax credit note must be issued to the customer.

Exports

(See Section 9 and Schedule III of the VAT Act 2000)

Any taxable supply which is listed in Schedule III is zero-rated. This includes the export of
goods and services,
Subject to certain conditions, including -
• goods must be entered for export with customs, and exported from Namibia;
• proof of export, in the form of a copy of the export entry certified by customs, must be
retained by the registered person;
• international transport services;
• a supply of services directly in respect of goods temporarily imported;
• the repair, maintenance, cleaning or reconditioning of any foreign-going ship or
aircraft.

Imports

(See Sections 2 and 11 to 14 of the VAT Act 2000)

(a) Import of goods

VAT is payable at the time of importation of goods. If a person wishes to avoid the necessity
to pay VAT at the border - either in cash, or by bank guaranteed cheque - he must make
prior arrangements with Customs and Excise. This can be in the form of prepayment, a VAT

11
 import account with Revenue, or by a guarantee by a foreign importer. More details of these
arrangements can be obtained from Inland Revenue.

The value of imported goods for VAT purposes in the case of imports from non-SACU
countries, is an amount equal to the sum of:

• the free-on-board value of the goods; and

• an amount equal to 10% of the free-on-board value of the goods

or,

• the open market value, determined under section 2 of the VAT Act, 2000.

(b) Import of services

VAT is payable on the import of services other than to make taxable supplies and the person
liable for payment of VAT on the import of services is the recipient of the services, who must
furnish an import declaration and pay the tax due within 30 days after the import.

(c) Exempt Imports

Imported goods and services are exempt from VAT if:

• they are specified in Schedule V of the VAT Act 2000; or
• the goods or services would be exempt under Schedule IV if supplied in Namibia.

Input Tax - other rules

(See Section 19 of the VAT Act 2000)

No input tax deduction is allowed in respect of the purchase or import of:

• entertainment - which includes the provision of food, beverages, tobacco,

accommodation, amusement, recreation or hospitality of any kind, unless the recipient

12
 is in the business of providing entertainment or a tour operator, and the purchase or
importation relates to the provision of entertainment by the recipient in the ordinary
course of business; or the recipient is in the business of providing transportation services
and the entertainment is provided to passengers as part of the transportation service; or
• passenger vehicles - which means road vehicles designed and used solely for the
transport of nine or fewer seated persons and includes a double cab vehicle unless the
recipient is in the business of dealing in, hiring of, tour operator or was acquired by a
short-term insurer to indemnify, an insured person under a short-term insurance contract
and the vehicle was acquired for the purposes of such business, a vehicle acquired by any
charitable organisation, children’s home, old age home or orphanage; or
• fees or subscriptions - in respect of membership of any club, association, or society of
a sporting, social, or recreational nature; or
• petroleumproducts

Interest

(See Section 53 of the VAT Act 2000)

The Inland Revenue Department will charge interest at the rate of 20% per annum, on the
amount of any unpaid tax.

Lay-byes

(See Sections 3(8) and 7(6) of the VAT Act 2000)

The time of supply under a lay-bye agreement occurs at the time the goods are delivered to the
purchaser. If a lay-bye agreement is cancelled or terminated, and the registered person retains
any amount paid by the purchaser, the amount retained is for a taxable supply of services.

Local authorities

(See Sections 1 and 15(5) of the VAT Act 2000)

13
 Alocal authority is defined as any municipal council, town council or village council established
under the Local Authorities Act, 1992. Any local authority which carries on a taxable activity
becomes liable to be registered from the date of commencement of that activity.

Objections

(See Section 27 of the VAT Act 2000)

Any person who is dissatisfied with an appealable decision may lodge an objection in writing
within 90 days, specifying in detail the grounds upon which it is made.

Offences

(See Sections 54 - 65 of the VAT Act 2000)

The following are offences, generally punishable on conviction by a fine of up to N$ 8 000 or

to imprisonment for up to two years, or both -
• failure to apply for registration;
• failure to notify changes of circumstances:
• failure to provide proper tax invoices;
• failure to furnish any return or other required document;
• failure to comply with an official notice or document;
• failure to maintain proper records;
• failure to provide reasonable assistance to a taxation or customs officer;
• improper use of a VAT registration number;
• making false or misleading statements to a tax officer;
• obstruction of a tax officer in the performance of his duties.

Penalties

(See Sections 66- 71 of the VAT Act 2000)

There are various penalties for the following -

• failure to apply for registration (penalty of double the output tax payable)

14
• failure to furnish a VAT return or import declaration;
• failure to pay tax when due;
• failure to maintain proper records;
• making false or misleading statements to a tax officer (penalty of double the tax
evaded)

Prices (tax-inclusive)

(See Section 77 of the VAT Act 2000)

All prices advertised or quoted by registered persons should be inclusive of any VAT
chargeable, and this should be stated in the advertisement or quotation, or by way of a notice
prominently displayed at all entrances to the registered person’s premises.
However, a registered person may advertise or quote a price as exclusive of tax provided he
also states the amount of tax charged on the supply, and the tax inclusive price - and both
prices must be advertised or displayed with equal prominence or impact.

Record-keeping

(See Section 48 of the VAT Act 2000)

All registered persons must maintain at least the following records, in Namibia, in the English
language, for at least five years after the end of the tax period to which they relate:
• original tax invoices, credit notes and debit notes received;
• copies of all tax invoices, credit notes and debit notes issued;
• customs documentation relating to imports and exports;
• invoices for supplies to unregistered customers;
• accounting records; and
• any other records which may be prescribed by the Commissioner.

Refunds

(See Sections 38 and 39 of the VAT Act, 2000)

It may happen that in some periods, a registered person will have more input tax to reclaim
than output tax to pay for example, if he has bought a large amount of stock, or an expensive

15
 piece of’ capital equipment. In this situation, the registered person will have a credit of VAT
due to him on his VAT return. This credit of tax may be used to pay off any outstanding taxes,
penalties or interest, after which, any remaining credit may be refunded.

Refunds will be made not later than the end of the second calendar month following the date
credit balance arises on the person’s account.
Where Inland Revenue does not refund within this period, interest shall be paid on such
amount at the rate of 11% per annum. However, if a return for any period is outstanding, no
interest shall be so payable.

Tax Periods and Tax Returns

(See Sections 23 and 24 of the VAT Act 2000)

All registered persons must submit tax returns within 25 days of the end of each tax period,
which is two calendar month, except in the case of persons whose only taxable activity are
farming activities (agricultural, pastoral, or horticultural and includes the renting of grazing,
renting of livestock, conducting of hunting or conducting of farm shops for labourers), whose
tax period is two, four, six or twelve months. The tax period of registered persons whose
activities are other than farming, will be divided into a Category A or B. Category A periods
end on the last day of January, March, May, July, September and November of each calendar
year, and Category B periods end on the last day of February, April, June, August, October
and December.

Transfer of a going concern

(See Sections 3(2), 3(3), 9(1) and 15(3)(a), and Schedule III paragraph 2(q) of the VAT Act
2000,)

The transfer of a taxable activity (business) or part of a taxable activity capable of separate
operation as a going concern, means that:
• all the goods and services necessary for the continued operation of the business (or
separate part of the business) are supplied to the transferee (purchaser); and
• the transferor (seller) was carrying on the business up to the time of transfer.

16
If both seller and buyer are registered for VAT, then the transfer of the business is a zero-rated
supply, provided a notice in writing signed by both parties is furnished to the Inland Revenue
Department within 21 days after the supply takes place.

Value of a supply

(See Sections 1 and 8 of the VAT Act 2000)

Normally, the value of a supply of goods or services for VAT purposes is the amount of the
consideration (including any excise duty) for the supply (excluding the VAT itself).
However, there are exceptions, including:
• where a supply is made by a registered person for a price which is nil, or less than the
open market value, and the registered person and the recipient are “connected persons”,
the value of the supply for VAT purposes is the open market value if the recipient is not
a registered person. If the recipient is a registered person than the value of supply shall
be the amount of such consideration. (The definition of “connected persons” is given in
Section 1 of the VAT Act, 2000);
• where a registered person supplies goods or services to an employee, the value is the
lesser of the cost price, or the open market value;
• the value of a supply of goods under a credit agreement is the cash value;

VAT Invoices

This section explains the general VAT rules that apply to tax invoices issued by registered
persons. The legal requirements are set out in the VAT Act 2000 Section 21 and Schedule VI.

(a) General: What is a tax invoice? Whenever a registered person supplies taxable goods or
services to another registered person, he must give that person a tax invoice, which is a
document containing certain information (see below) about what he is supplying. The
customer will need the tax invoice to reclaim input tax on the purchase. You need not
issue a tax invoice for supplies to customers who are not registered.
Only one tax invoice can be issued for each taxable supply. However, if the recipient
claims to have lost the original tax invoice, the supplier can provide a copy clearly
marked “copy”

17
 (b) Requirements: A tax invoice must contain:

• the words “tax invoice” written in a prominent place;

• the name, address and VAT registration number of the supplier;
• the name and address of the recipient;
• the individualized serial number and the date on which the tax invoice is issued;
• a description of the goods or services supplied;
• the total amount of tax charged. The consideration (price) for the supply, and the total tax
inclusive consideration; and
• the quantity or volume of the goods or services supplied.

It is not necessary to provide a tax invoice if the total consideration is in cash and does not
exceed N$100.

Vehicles

(See Sections 3(19), 4, 6( l )(a), 18 (1) (f), 18(2) and 19(2)(a) of the VAT Act 2000)

Input tax is not deductible on the purchase of a passenger vehicle (a road vehicle designed and
used solely for the transport of nine or fewer seated persons or a double cab vehicle), unless
the registered person is in the business of dealing in. or hiring those vehicles, a tour operator
or the vehicle was acquired by a short-term insurer to indemnify an insured person under a
short-term contract or the vehicle was acquired by any charitable organisation, children’s
home, old-age home or orphanage and the vehicle was acquired for the purpose of such
business.

The sale of a passenger vehicle on which the deduction of input tax was disallowed is not a
taxable supply. The sale of a vehicle by a non-registered person is not a taxable supply.

The sale of any new or used vehicle by a motor dealer who is registered for VAT is a taxable
supply, and input tax can be claimed on the purchase or trade-in of a vehicle from any person
subject to certain conditions.

18
Voluntary registration

(See Sections 15(4) and 16(2) of the VAT Act 2000)

Any person who is not required to register for VAT, because his taxable turnover does not
exceed the registration threshold (currently N$200 000), may apply to be registered if he feels
that it would be disadvantageous to him not to be registered. However, the Commissioner can
refuse to grant the application if the applicant has no fixed place of abode or business, or if
the Commissioner has reasonable grounds to believe that the applicant will not keep proper
records, or will not submit regular and reliable tax returns.

Vouchers

(See Sections 3(22) and 8(9) - (11) of the VAT Act 2000,)
Normally, the issue of a token, voucher or stamp (other than a postage stamp) is not a supply,
unless the consideration in money paid for the token exceeds the monetary value of the goods
or services receivable in exchange for the token.

However, if a registered vendor issues tokens, etc., free of charge, and the recipient is thereby
entitled to a discount on other goods or services, the value of such goods or services includes
the monetary value stated on the token.

19
20