If your business makes under R2.3 million in sales a year, you don't have to register for VAT — but you can choose to. Here's how to weigh it up:
Pros
Some customers only work with VAT-registered suppliers. Larger companies and government tenders often require it.
A VAT registration number can make your business look more established.
If you buy a lot from suppliers who charge VAT, you can claim that VAT back.
Cons
It's more admin. You have to file a VAT return every two months, which usually means paying an accountant.
It can strain your cash flow. You owe SARS the VAT as soon as you invoice a customer, even if they haven't paid you yet.
You have to add 15% VAT to your prices, which can make you more expensive to customers who aren't VAT registered themselves.
Still deciding? See whether you have to register for VAT, or what it takes to register voluntarily.