How is VAT charged on commercial property in SA?

The Value-Added Tax Act, No 89 of 1991 (VAT Act) differentiates between two types of residential property; commercial and “dwellings”

Commercial properties are subject to the standard rate of 15%, while dwellings are exempt from VAT.

Output VAT is levied on 60% of the full value of the supply (accommodation + domestic goods and services).

SARS usually determines whether the property qualifies as commercial or a “dwelling”.