08 Mar

Often companies find themselves with a common predicament when claiming Input VAT on their vehicles. In this article we will explore extended cabs, and how and when you can claim VAT on these vehicles.

Not too recently motor vehicle manufactures introduced a clever concept to their single cabin pick-up truck vehicles commonly known as the club cabs or extended cabs.  An extended cab is an extended 4-door “bakkie”, with two traditional full-sized doors and two smaller-sized rear doors that open backwards.  These vehicles are specially designed with extra space behind the driver’s seat mainly for safe storage inside the vehicle for a toolbox for example.


Extended cabs are registered as a vehicle for two, however most of the modern extended cab bakkies are fitted with two ‘jump seats’ or a full bench or fold up seat behind the drivers seat. Although the vehicle can only take two people legally, The South African Revenue Service (SARS) argues that the vehicle is therefore designed for the carrying of both passengers and goods, which gives rise to the debate of whether or not the extended cab is excluded from the definition of a “motor vehicle” and ultimately if VAT can be claimed on the purchase of this vehicle.

Definitions as stated by the legislature.

According to the VAT Act No. 89 of 1991, the definition of a “motor car” includes a motor car, station wagon, minibus, double cab light delivery vehicle and any other motor vehicle of a kind normally used on public roads, which has three or more wheels and is constructed or converted wholly or mainly for the carriage of passengers, but does not include-

  1. vehicles capable of accommodating only one person or suitable for carrying more than 16 persons, or
  2. vehicles of an unladen mass of 3 500 kilograms or more; or
  3. caravans and ambulances;
  4. vehicles constructed for a special purpose other than the carriage of persons and having no accommodation for carrying persons other than such as is incidental to that purpose;
  5. game viewing vehicles (other than sedans, station wagons, mini-buses or double cab light delivery vehicles) constructed or permanently converted for the carriage of seven or more passengers for game viewing in national parks, game reserves, sanctuaries or safari areas and used exclusively for that purpose, other than use which is merely incidental and subordinate to that use; or
  6. vehicles, constructed as or permanently converted into hearses for the transport of deceased persons and used exclusively for that purpose;

A “vendor” refers to any person who is registered or required to be registered under this Act: Provided that where the Commissioner has under section 23 or 50A determined the date from which a person is a vendor that person shall be deemed to be a vendor from that date;


The definition of “motor car” contains the following five categories:

  • Motor car
  • Station wagon
  • Minibus
  • Double cab light delivery vehicle
  • Any other motor vehicle that –
    • is normally used on public roads;
    • has three or more wheels; and
    • is constructed or converted wholly or mainly for the carriage of passengers.

The main point to consider is, category five, referring to the constructed or converted wholly or mainly for the carriage of passengers.  Any vendor must, in determining if an extended cab is excluded from the definition of “motor vehicle”, perform an objective test. The most important point of the objective test is that if any vendor is forgoing an amount of loading space to accommodate or create a more convenient passenger space, will indicate that a vehicle may be constructed mainly for the carriage of passengers.

The Objective Test:

  1. The objective test requires a one-dimensional measurement of the length of the area designed for the carriage of passengers in relation to the dedicated loading space in a vehicle.
  2. In applying the objective test, one must determine which area measures more in length, the passenger area, or the dedicated loading space. The engine area should be disregarded for the purposes of this determination.
  3. If the passenger area measures more than the dedicated loading space, the vehicle is constructed mainly (that is, more than 50%) for the carriage of passengers and will thus constitute a “motor car” as defined.

The dedicated loading space is the area that is constructed solely for a purpose other than the carriage of passengers.  There are vehicles constructed with an area within the vehicle that serves a dual purpose of providing both loading and passenger space (that is, fold-up seats that provide a loading area when folded up).  Since this area can be used to accommodate passengers, the entire area will be regarded as a space designed for the seating of passengers.


In reference to INTERPRETATION NOTE: NO. 82, dated 25 March 2015, all vendors should not assume that when purchasing extended cab for making taxable supplies that it does not form part of the definition of “motor car”.  The vendor should always preform an objective test on this vehicle and not only consider the following factors as these factors are irrelevant to the test:

  1. classification of the vehicle for licensing purposes;
  2. purpose for which the vehicle is actually used; or
  3. purpose for which it was acquired.

Once the vendor is satisfied that the vehicle complies with the objective test, will the vendor be able to claim the input tax.

Author: Kobus Pretorius

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