VAT works as a running tally of two figures. When a registered business sells, it charges VAT to its customers — that is output tax. When it buys, it pays VAT to its suppliers — that is input tax. The VAT201 return reports both for a period.
If output tax exceeds input tax, the business pays the difference to SARS. If input tax is higher — common when you have made large purchases — SARS may refund the difference. The return is how that calculation is declared for each period.
Accurate VAT reporting depends on clean records: correctly issued tax invoices, and credit notes for any corrections, so the VAT charged and reclaimed can be reconciled. This is general information — confirm your VAT registration and filing obligations with a tax practitioner or SARS.