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Research by Country/Region January 19, 2018  
SOUTH AFRICA: CUSTOMS, TAXES, and DOCUMENTATION REQUIREMENTS: IT PRODUCTS and SERVICES IMPORTS

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A. Is this country a member of the Information Technology Agreement?

B. Customs documentation requirements for IT products

C. Software: duties and taxes, updates, licenses, electronically delivered

D. IT services: tax treatment and other regulations

E. Refurbished, used, or repaired computer equipment imports


A. IS THIS COUNTRY A MEMBER OF THE INFORMATION TECHNOLOGY AGREEMENT?
NO
Signatories to the Information Technology Agreement (ITA) have eliminated their import duties on a wide range of information technology products, including software and computer hardware. For more information on the ITA, and exact tariff elimination schedules of signatories, click here.
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B. CUSTOMS DOCUMENTATION REQUIREMENTS FOR IT PRODUCTS

What are the documentation requirements for the physical import of software? For other information technology products?
The Department of Customs and Excise requires the following documents to clear imports:
--Bill of lading/air waybill/road hauliers certificate
--Commercial invoice
--Customs worksheet
--Bill of entry (DA500)
    A certificate of origin (DA59) is required for imports of certain strategic commodities or imports of goods involved in anti-dumping charges (e.g.: shoes from Hong Kong, t-shirts from China).
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    C. SOFTWARE: DUTIES and TAXES, UPDATES, LICENSES, ELECTRONICALLY DELIVERED

    DUTIES AND TAXES ON SOFTWARE IMPORTS

    Are duties assessed on the intellectual property of the software or on the medium on which is it presented?
    No duties are assesed on the intellectual property of the software.

    Are taxes assessed on the intellectual property of the software or on the medium on which is it presented?
    Value-added tax (14%) is payable on the declared value of the product (this is recoverable by the importer/customer as an input
    tax).

    Is customized software treated differently than packaged software?
    No.
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    IMPORTS OF SOFTWARE UPDATES

    What are the customs duties and tax implications for software sold with updates when the full sales price, including cost of updates, is shown on the original commercial invoice? Are duties and taxes paid on that amount? What happens when the updates are sent at a later date? Are duties/taxes applied again? If so, based on what value? How should information presented on the commercial invoice for the original and subsequent shipments to avoid paying duties/taxes more than once on a single sale?
    A above, there will be no duties charged but VAT will be payable. Where updates are sent at a later date, the customs office has to be convinced that they were included in the original invoice – if not VAT will apply to the updates.
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    SOFTWARE LICENSES: CUSTOMS CLASSIFICATION, IMPORT DUTIES, TAXES, OTHER

    Are software licenses classified in Harmonized System 4907?
    There are no recognised codes applicable.

    Are import duties/taxes applied? If so, on what cost/price base are they levied? Are withholding or other additional taxes applied on software licenses? If yes, how?
    There are no special taxation and no withholding or other additional taxes applied to software licences in South Africa.

    If a U.S. license agreement is included in the packaging or is part of the installation/registration of shrink-wrapped software imported from the United States, would that agreement be binding on consumers in your market? If so, would U.S. or local laws pertain?
    By using the sofware, the user agrees to be bound by U.S. law. South Africa abides by intellectual property rights and therefore the terms and conditions of the licensee agreement will be binding on even the end-users of the product. Being a party to the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), South Africa is obliged to comply with the minimum standards set by that Agreement for the protection of intellectual property.
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    SOFTWARE DELIVERED OVER THE INTERNET/ELECTRONICALLY DELIVERED SOFTWARE

    Are taxes applied to software delivered to the end-user over the Internet? If so, on what value?
    No import taxes apply. There is no mechanism for collection of taxes in this instance.

    Would the situation be different if this software were instead delivered to a distributor who has a license to produce (replicate) and sell the software?
    If software is delivered to a distributor with a licence to replicate, the distributor would be charged VAT on the sales of the reproduced software.

    What are the documentation requirements for the electronically delivered import of digitized products (i.e. software, movie downloads) over the Internet or other networks?
    There is no current way of regulating electronic delivery of digitized products over the Internet.

    Must an electronically delivered software import be accompanied by a physical shipment of the same product?
    We have no knowledge of legislation regulating electronically delivered software.
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    D. IT SERVICES: TAX TREATMENT AND OTHER REGULATIONS

    Are services (i.e. training, set-up, etc) relating to the sale of software taxed? If so, at what rate and based on what value?
    Services relating to the sale of software will not be taxed unless supplied by a South African agent, in which case VAT will be applied.

    Are U.S. IT solution providers permitted to send personnel into the country to set up hardware/software-related systems?
    Yes.

    Are special visa, work permits, and/or professional certification by an accredited body required?
    Visas and work permits are required if the personnal will work in South Africa for more than 90 days.
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    E. REFURBISHED, USED, OR REPAIRED COMPUTER EQUIPMENT IMPORTS

    1. REFURBISHED COMPUTER EQUIPMENT
    Is the import of refurbished computer hardware, parts, and accessories (including toner cartridges) permitted?
    The import of refurbished computer hardware, parts and accessories is pertmitted.

    If so, what are the documentation requirements?
    There are no special documentation requirements.

    Is special labeling required?
    There are no special labelling requirements.

    What value should be shown on the invoice?
    Real value should be reflected on the invoice..

    How are duties and taxes assessed?
    No duties are assesed but VAT is applicable. If the refurbished equipment is being sold, VAT will be assessed on the
    invoice value. If it is being donated, there is no invoice.
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    2. USED COMPUTER EQUIPMENT
    Is the import of used computer hardware, parts, and accessories (including toner cartridges) permitted?
    Same as for refurbished computer equipment. See answers above.
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    3. REPAIRED COMPUTER EQUIPMENT
    Are duties and taxes assessed on the re-import of repaired computer equipment?
    No.

    How should the commercial invoice appear?
    There is a requirement of proof of ownership of goods dispatched for repairs. The commercial invoice will reflect the details of the repair and its cost. However, to avoid being assessed for tax on the value of the equipment itself, the owner would have to produce evidence that the equipment had originally been purchased and subsequently sent abroad for repair. This would be a copy of the original purchase documentation and a certificate from customs when the equipment was shipped out for repairs.
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    RESPONSE INFORMATION

    This response was prepared by the U.S. Department of Commerce/Commercial Service in Johannesburg, South Africa, in February and September 2003. For further clarification please contact:
    Bheki Ndimande
    Commercial Specialist
    U.S. Embassy, Johannesburg
    beki.ndimande@mail.doc.gov

    Special Notes: The above information is intended to serve only as unofficial guidance. In seeking to obtain government rulings in specific cases, it will often be necessary to refer to special laws, separate regulations and announcements, and case-by-case decisions by the government. Beyond the general guidelines shown above, legal counsel should be retained at an early stage of consummation of a major procurement contract, and before entering into any legal commitments.

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