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Botswana

Any price charged by a registered person in respect of a taxable supply is deemed to include the VAT charged on the supply, whether or not VAT has been included in the price.

Calculation of output tax

VAT is payable at the rate of 10% on the value of:

  • every taxable supply by a registered person; and

  • every import of goods or of services, other than an exempt import.

Output tax is calculated by applying the tax fraction (10/110) to the VAT- inclusive price charged.

Exemptions and zero-rating

Exempt supplies

No VAT is charged on exempt supplies, and VAT paid on inputs acquired for purposes of making exempt supplies may not be deducted as input tax. A person making only exempt supplies is not carrying on an enterprise and may not register for VAT purposes.

Exempt supplies include, but are not limited to, supplies of the following goods or services:

  • financial services, including loans, credit, credit guarantees or any security for money, but excluding transactions rendered at a fee or commission;

  • educational services including courses, school bus services and meals provided by an exempt educational institution to its students;

  • medical services provided by a Government-operated or -aided medical facility;

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certain services supplied directly to a nonresident, nonregistered person, other than through an agent relating to foreign-going aircraft or a container temporarily imported;

repair of a railway train operated by a nonresident, nonregistered person;

services physically rendered outside Botswana;

services supplied to a nonresident who is outside Botswana when the services are rendered, except services rendered directly in connection with property situated in Botswana or the refraining from undertaking an activity in Botswana;

services relating to intellectual rights for use outside Botswana;

taxable activity supplied to a registered person as a going concern;

sorghum or maize meal supplied for human consumption, but not when furnished as a meal or as cooked or prepared food;

goods or services for the personal or official use of the President or any dependent member of his family;

millet grain, millet meal, wheat grain, maize cobs, flour, sugar and Setswana beans in their natural state and not mixed with other products;

pesticides; fertilisers; and

tractors when acquired by a person operating a farming business.

  • long-term residential letting and hostel accommodation on a nonprofit basis;

  • leasing or renting of land for erecting a dwelling;

  • certain prescription drugs;

  • sectional title management levies;

  • domestic passenger transportation by road or rail other than transportation of tourists;

  • cash grants made by or received from the state;

  • supply of condoms; and

  • donations.

Zero-rated supplies

Adequate documentation must be retained to satisfy the Commissioner General that the supply qualifies for zero-rating. The zero-rated supplies include (but are not limited to) supplies of the following goods or services:

  • exportation of goods;

  • goods that are outside Botswana at the time of the supply;

  • goods supplied under a rental agreement or charter party exclusively in an export country;

  • goods or services supplied to a branch or main business outside Botswana, which can be separately identified and for which an independent system of accounting is maintained;

  • international transport services;

  • services supplied directly in connection with land outside Botswana;

  • services supplied directly in respect of movable property situated outside Botswana, and goods temporarily imported;

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