Are you emigrating and closing your business in South Africa, or moving overseas while still maintaining your business operations back home? Either way, understanding what to do with your VAT registration at SARS can be confusing – but it doesn’t have to be.
In this article, we’ll explain what VAT deregistration means, when you need to do it, and how to cancel your VAT registration with SARS if you’re closing your business or fully stopping your taxable activities. We’ll also cover how you can keep your business running in South Africa even after completing tax emigration, so you know exactly what steps apply to your situation.
What is VAT deregistration, anyway?
Simply put, VAT deregistration means cancelling your VAT registration with SARS. This can happen either because SARS decides to cancel it, or because you, as the business owner, request it in writing, and the right conditions are met.
Why would you want to deregister from VAT? Usually, it’s because you’re:
- Closing your business in South Africa
- Your business turnover drops below the R1 million threshold
- You’re emigrating and stopping your taxable activities in South Africa
Knowing what triggers VAT deregistration helps you avoid surprises down the line.
When should you deregister your VAT with SARS?
If you’re planning to close your business or emigrate, it’s essential to initiate the VAT deregistration process with SARS promptly to ensure everything remains above board.
Here are the common triggers for deregistering for VAT in South Africa:
- If you’re closing your business permanently
- If your annual turnover falls below the VAT registration limit (currently R1 million)
- If you’ve emigrated and ceased trading locally
- If your business is sold, transferred, or no longer meets VAT requirements
SARS VAT cancellation for expats – how do you deregister for VAT?
Good news — it’s pretty straightforward. Here’s what you need to do:
- Submit a formal request to SARS to cancel your VAT registration. If you’re registered on eFiling, you can apply online.
- SARS will review your request and respond.
- File a final VAT return covering all your sales and purchases up to the deregistration date.
- Pay any VAT you owe, or request a refund if you’re due one.
For full details straight from the source, check out the official SARS page: Cancellation of VAT registration.
What happens to VAT when you emigrate?
Now, here’s a question many expats ask: “What happens to my VAT number when I emigrate?” If you’re emigrating from South Africa but your business is still trading locally, you need to keep your VAT registration active. This means you still:
- Charge VAT on your local sales
- Submit VAT returns regularly
- Pay any VAT due to SARS
However, if you’ve stopped all your taxable business activities in South Africa because you’re emigrating, then it’s time to apply for VAT deregistration.
Can you keep your business if you tax emigrate?
The short answer: yes! You can keep your business in South Africa even if you’re no longer a tax resident.
But keep this in mind:
- Your business must still meet its VAT obligations, including charging and paying VAT on local sales.
- You’re responsible for filing VAT returns on time.
- Only deregister if you’ve stopped trading locally.
Read more: Should you undergo tax emigration if you live abroad but still have assets in South Africa?
What are the tax implications of emigrating with a business?
Tax emigration from South Africa isn’t just about changing your residency status. If you have a business, it comes with important responsibilities — especially around VAT and other taxes.
Whether you’re closing your business or emigrating, here are a few key things to keep in mind:
- Notify SARS as soon as possible about your plans.
- Make sure all your VAT obligations are fully settled before you deregister.
- Submit your final VAT return on time to avoid penalties.
But remember, cancelling your VAT registration doesn’t mean you’re off the hook for other taxes like income tax or capital gains tax. It’s important to stay on top of these to avoid any surprises.
Read more: Benefits and implications of completing tax emigration as a South African business owner.
Wrapping it up: your VAT deregistration checklist
- Know what triggers VAT deregistration for your situation
- Submit your VAT deregistration request to SARS promptly
- File your final VAT return and settle any outstanding amounts
- Keep your VAT registration active if your business continues to operate in South Africa after you emigrate
- When in doubt, reach out to a tax expert to help guide you through the process.
FinGlobal: cross-border financial specialists for expats
By now, you’ve probably realised that getting professional advice is key when managing your move. Working with a qualified tax advisor who understands both South African tax rules and those of your new country can make all the difference — helping you avoid headaches and ensuring a smooth, stress-free transition.
That’s exactly where FinGlobal comes in. Our team of certified international financial planners, lawyers, chartered accountants, tax experts, and bankers are ready to guide you through every step of your cross-border financial migration. Whether it’s expat tax compliance, tax emigration, or retirement annuity withdrawal, you can count on our expertise to support you.
Want to find out more about FinGlobal’s reliable, cost-effective services? Just leave your contact details in the form below, and we’ll reach out to discuss how we can best assist you.