First new digital tax for South Africans emerge

Atlassian, an overseas software vendor, has sent e-mails to its South African customers informing them it will begin collecting value added tax (VAT) from them on 1 April 2014.

This is “in accordance with recent changes to South African tax legislation on electronic services,” Atlassian told its customers.

Towards the end of January 2014, National Treasury published new electronic service regulations for public comment which would see 14% VAT charged on digital products and services.

The deadline for public comments was 20 February 2014, but the final regulations do not appear to have been published in the government gazette.

Atlassian was asked whether their invoices would be in Rand or US Dollar, how collected VAT will be paid to National Treasury, and why they bothered complying with South African tax laws rather than cut us off.

A spokesperson for the company said that they “respectfully decline to comment on this topic.”

Atlassian digital tax email screenshot
Atlassian digital tax email screenshot

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First new digital tax for South Africans emerge