Here is a piece of good news hiding in the tax code: since 1 January 2026, everything schools supply is exempt from Value Added Tax, and the South African Revenue Service (SARS) is now helping schools tie off the last bit of admin so they can enjoy the simpler system in full.
The legislative change means schools registered under the South African Schools Act no longer charge VAT on their supplies, with the only exception being qualifying welfare activities a school may run, SAnews reports. For school governing bodies, bursars and finance committees, that translates into less paperwork, fewer returns and one less layer of complexity in already-busy school offices.
What Changes for Schools
In a statement issued on Friday, SARS called on schools that are still registered as VAT vendors to apply to cancel that registration, the final housekeeping step under the new dispensation.
“Schools may therefore not charge VAT or deduct input tax on supplies made from 1 January 2026 and must correct any VAT returns already submitted for periods from that date where necessary,” the revenue service said.
The process itself has been kept refreshingly simple. Affected schools need to:
- Complete the VAT123e form, the application for cancellation of registration.
- Give the reason for cancellation as: “All enterprise activities have ceased on 31 December 2025”.
- Email the completed form to contactus@sars.gov.za with the subject line “VAT deregistration – Schools”.
Schools that prefer to speak to a person can instead book a virtual appointment through the SARS eBooking system, selecting “Other” as the reason category and “VAT and PAYE registration/deregistration” as the reason for the appointment.
Flexibility Where It Is Needed
SARS has also built in breathing room for schools that owe exit VAT when they deregister. “Where exit VAT is payable, schools may submit a request for payment arrangements together with the VAT123e form,” the revenue service said, confirming that registration will be cancelled once the exit VAT has been declared and paid, or once the school has complied with an agreed payment arrangement.
Schools that run qualifying welfare activities and wish to remain registered as VAT vendors for those activities can do so, they simply need written confirmation from the Commissioner by way of a ruling.
Why It Matters
Tax administration rarely makes for cheerful headlines, but this change is a quiet win for the education sector. A simpler VAT regime means school administrators spend less time on returns and reconciliations and more time on the core business of running schools. Further guidance is available on the SARS website, and the revenue service’s proactive outreach, telling schools exactly which form, which wording and which email address to use, is exactly the kind of practical, service-minded communication that makes compliance easier for everyone.
For South Africa’s schools, the books just got a little lighter, and that is worth marking present.
Photo: commons.wikimedia.org
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