South African schools face a major VAT change in 2026: What SARS wants them to do

The South African Revenue Service (SARS) has called on schools registered as VAT vendors to apply for the registration to be cancelled.

The South African Revenue Service (SARS) has called on schools registered under the South African Schools Act and currently registered as VAT vendors to apply for the cancellation of their VAT registration.

This comes after changes to the VAT treatment of schools came into effect on January 1, 2026. From that date, all supplies made by schools registered under the South African Schools Act are exempt from VAT, except to the extent that a school conducts qualifying welfare activities.

Schools can therefore no longer charge VAT on these supplies or claim input tax deductions on related expenses from January 2026.

The revenue service said the deregistration process is not automatic and affected schools must apply for cancellation of their VAT registration.