SARS's proposed digital VAT model explained
What SARS's VAT modernisation consultation proposes, where it stands, and what a South African business can sensibly do while it is a proposal.
By Achekam · · 4 min read · For Running a business businesses in South Africa
Every few months a headline announces that South Africa is "moving to e-invoicing", followed by warnings that businesses must act now. For an owner trying to work out what has actually changed, the noise is not much help.
What has happened is specific. SARS has published a proposal for a new digital VAT model and asked for comment. It is a proposal, not a rule, and nothing in it yet tells a business to change how it invoices. This article sets out what SARS is proposing, where the process stands, what Achekam does and does not do today, and the practical steps that make sense whatever the final model looks like.
The direction SARS describes
SARS says its VAT modernisation direction is to connect SARS to every point of sale using e-invoices, an interoperability framework and e-reporting, building towards SARS-led VAT auto-assessment.
Each part of that sentence points to a change from today's model:
| Element | In plain terms |
|---|---|
| E-invoices | Invoices in a structured electronic form |
| An interoperability framework | Common rules so that different systems can exchange them |
| E-reporting | Transaction data reported to SARS electronically |
| SARS-led auto-assessment | SARS working out the VAT position from that data |
Today, a vendor works out its own VAT and declares it on the VAT201. The direction SARS describes would shift much of that work towards SARS, using invoice data it has already received. SARS's page is explicit that this is at proposal stage only.
Where it stands
The timeline so far, as SARS has published it:
- 17 August 2026: SARS released a VAT Modernisation Consultation Paper for public comment on a new digital VAT model.
- 8 September 2026: SARS published FAQs explaining its proposed Digital VAT Model and what different business segments may need to consider.
- 16 October 2026: the closing date SARS set for submissions on the consultation paper.
SARS invited businesses, software developers and public-finance entities to comment, and says responses must be submitted through the link in the consultation paper itself.
If your business has a view, the consultation is the moment to give it. A small retailer that issues hundreds of till slips a day, a contractor that invoices in stages, and a professional practice with a handful of large monthly invoices may each be affected differently, and SARS asked businesses for their comments.
A consultation is where a proposal gets tested. What comes out the other side may differ in scope, timing and detail from what went in, so it would be premature to rebuild your invoicing around the paper's first draft.
SARS's VAT modernisation page holds the consultation paper, the FAQs and the details of how to comment; it is the place to watch for what happens next.
What to read in the FAQs
The FAQs are organised around what different business segments may need to consider. Rather than reading summaries, read the part that describes a business like yours. Questions worth asking as you read:
- Does the proposal treat businesses of your size or type differently?
- What would change at the point of sale or invoicing for you?
- What would your invoicing or accounting software need to do?
- Is any date proposed, and is it described as firm or indicative?
Write down the answers with the date you read them. If SARS updates the FAQs after the consultation, you will be able to see what changed.
What Achekam does today
It is worth being plain about the current position, so nobody is misled.
Achekam has no e-invoicing for South African businesses. It does not prepare, store or submit a South African VAT201 return, and nothing is submitted to SARS eFiling. Your return is completed and filed by you or your accountant. Which figures a business can take from its Achekam books for that return is covered in preparing your VAT201 when your books are in Achekam.
What Achekam does do is keep the invoice record that any future model would draw on. A business creates customer invoices as drafts it can change or delete. Issuing one takes the next number in its sequence and posts it to the ledger as debtors, sales and output VAT. The invoice, the number and the ledger entry come from one action, so the VAT you charged is in your books the moment the invoice is issued.
Getting invoice data clean and numbered now
Whatever form SARS's final model takes, it is built on invoice data. A business whose invoices are complete, consistently numbered and correctly tied to its ledger will find any change easier than one that keeps invoices in a word processor and numbers them by hand.
Steps that make sense now, regardless of the outcome:
- One numbering sequence. Issue every customer invoice from one system, so the numbers run without gaps or duplicates.
- Complete customer details. Make sure each customer's legal name, address and VAT number, where they have one, are correct in your records.
- The right invoice type. Know when a full tax invoice is required and when an abridged one is enough; see full or abridged tax invoice: which one to issue.
- No invoices outside the books. An invoice that never reaches the ledger is an invoice that will not match whatever SARS receives.
- Watch the consultation. Check SARS's page after the closing date for the next step.
Keeping perspective
The proposal is significant, and it may well change how South African VAT works in the years ahead. But until SARS publishes final rules, the sensible response is preparation, not panic: read the FAQs for your segment, keep your invoicing clean and in one place, and decide on changes when there are rules to decide against.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
