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Import VAT is recoverable for a registered vendor — but you still have to fund it on day one and wait to claim it back. On a big shipment that timing gap can swallow your working capital for weeks. This guide explains how import VAT and duty are charged, how a SARS deferment account spreads the pain, and the practical levers SA importers use to protect cash flow.
How import VAT is calculated
Import VAT is charged at 15% on the added-tax value: the customs (CIF) value, uplifted by 10% for goods originating outside the SACU/BLNE area, plus the customs duty. Duty itself is charged on the customs value before the upliftment.
Duty = 500,000 × 20% = R100,000
VAT base = (500,000 × 1.10) + 100,000 = R650,000
Import VAT = 650,000 × 15% = R97,500
Cash needed at clearance for tax alone = R197,500 (plus freight, port and agent fees).
If you are a registered VAT vendor, that R97,500 import VAT is claimable as input tax on your next VAT return — but you carry it until SARS refunds or it offsets your output VAT.
The cash-flow gap
The problem is timing. You pay duty and VAT to release the goods, then:
- You can only claim the import VAT back on your VAT return for the period — and only with a valid customs release / EDI proof in hand
- If you are in a net refund position, you wait for SARS to pay out
- You may not sell the stock for weeks, so output VAT to offset against arrives even later
The SARS deferment account
A deferment account lets approved importers pay customs duty and import VAT on credit terms instead of cash-on-clearance. Rather than settling each entry as goods land, accrued amounts are settled periodically (commonly within about a week of the deferment cycle closing). That means goods release immediately and the cash leaves later — closing much of the timing gap.
How to get one
- Be registered and tax-compliant with SARS via RLA
- Apply for the deferment facility (DA 650 application) and agree a deferment limit
- Lodge security for the limit — usually a bank guarantee covering the credit you are granted
- Maintain compliance — late settlement or breaching the limit can suspend the facility
Other cash-flow levers
| Lever | Effect |
|---|---|
| Bonded warehouse | Pay duty/VAT only as you draw stock for sale, not all on arrival |
| Industrial rebate (Sch 3/4) | Avoid the duty entirely on inputs used to manufacture for export |
| Monthly VAT category | If you are usually in a refund position, monthly returns recover input VAT faster than bi-monthly |
| Correct preferential origin | A valid certificate of origin can cut or zero the duty — less to fund up front |
| Trade finance / LC | A letter of credit aligns supplier payment with shipment milestones |
Pro tip: model the tax outlay before you order
Run every prospective shipment through a duty & VAT calculation first. Importers get caught not by the tax itself — which is recoverable — but by not having the cash on hand to release the goods on the day they land.
Related guides & tools
Frequently asked questions
How is import VAT calculated in South Africa?
At 15% on the added-tax value: the customs value, uplifted by 10% for goods from outside the SACU area, plus the customs duty. Example — R500,000 value with 20% duty: duty is R100,000, the VAT base is (500,000 × 1.10) + 100,000 = R650,000, and import VAT is R97,500, so you need R197,500 for tax alone at clearance.
Can I claim import VAT back?
A registered VAT vendor claims it as input tax on the next VAT return — but only with the prescribed customs release/EDI documentation in hand, and you carry the cash until it offsets output VAT or SARS refunds. Missing or mismatched release documents are a common reason claims are disallowed on audit.
What is a SARS deferment account?
A facility that lets approved importers pay duty and import VAT on credit terms instead of cash-on-clearance — goods release immediately and accrued amounts settle periodically. You apply on a DA 650, agree a deferment limit, lodge security (usually a bank guarantee), and must stay compliant or the facility can be suspended.
What other ways can importers protect cash flow?
A bonded warehouse (pay duty/VAT only as you draw stock), an industrial rebate under Schedules 3/4 (avoid duty on inputs used to manufacture for export), the monthly VAT category if you are usually in a refund position, a valid preferential certificate of origin (less duty to fund), and trade finance or letters of credit aligning supplier payment with shipment milestones.