South Africa Tax Agency Clarifies VAT Treatment of Dental Benefit Management Fees, Entitlements

The South African Revenue Service March 31 issued VAT Ruling No. VR 019, clarifying the VAT treatment of dental benefit management fees and benefit entitlements. The taxpayer, a resident dental benefit management services company, provided its services to medical aid regimes and regime members. The taxpayer sought clarification on VAT treatment. Upon review, the Tax Agency clarified that: 1) fees the regimes paid the taxpayer under capitation agreements were allocable between the portion calculated based on benefit entitlement, and the portion the taxpayer retained from the capitation fee for providing the regime dental services management and management care; 2) VAT ...