VAT Calculator (15%)

The VAT Calculator is a free online tool to help anyone wanting to calculate VAT quickly and easily for any goods or service. Just add the amount and press calculate. The current South African VAT rate is set at 15% and the results are broken down in into displaying both inclusive and exclusive amounts as well as the VAT portion for each option.

The gross amount divided by 1 + VAT percentage eg If 15% the divide by 1.15, then subtract the gross amount, multiply by -1 and round to the closest value.

Multiply the net amount by 1 + VAT percentage eg If 15% the multiply by 1.15.

Value Added Tax is commonly referred to as VAT. The South African Government requires most business to charge VAT on the supply of goods and services. These businesses are known as vendors and act as agents for the revenue service to collect VAT. VAT is charged at each stage of the production and distribution process and is a percentage of the prices charged for the goods and services.

VAT is also charged on the importation of goods and is collected by customs. There is a limited range of basic foods items such as brown bread, rice, milk and eggs which are exempt from VAT.

There are a limited number of basic foods types that are exempt from VAT. The intention is to help the poor with lower prices. Items such as brown bread, rice, vegetable oil, milk and eggs are exempt if purchased on their own, however if they are bought together as a prepared meal then VAT is applicable. It is recommended to always check with SARS for confirmation as it can be quite tricky; take the case of vegetable oil which is zero rated if colorant is added but not if flavouring is added.

On the 1 April 2018 the South African Revenue changed the VAT rate from 14% to 15%

A valid VAT invoice which is accepted by SARS must include the following:

The words Tax Invoice, VAT invoice or Invoice must be displayed as well as the name, address and VAT registration number of the supplier. The date, invoice number and an accurate description of the goods or service together with the quantity or volume.

If the invoice is over R5000 then the VAT number of the recipient must also be displayed if they are VAT vendors.

It is only compulsory to register for VAT when your turnover exceed R1m in any consecutive 12 month period. Businesses can however voluntarily register for VAT if the income exceeds R50,000 in the past 12 month period.

The VAT 101 form is the manual application to register for VAT, however we recommend registering on efiling. If you get stuck, please contact SwiftReg for assistance or watch the video above.

The VAT 201 return is the declaration made to SARS, which you the vendor need to complete at the end of every tax period (Usually every two months) The form will reflect both the input and output VAT.

This is the amount of VAT you PAID for goods or services. When you buy good or services from other companies that are VAT registered, you are paying them VAT, which you can claim back on your 201 Form.

This is the amount of VAT you CHARGED for good or services. Before you pay this over to SARS, you will deduct your INPUT Vat.

Value Added Tax is a tax which is added at every point in the supply chain where VALUE is added.

For Example: A manufacturer buys raw materials from a Supplier for (R100 x 15% VAT = R115) The Supplier pays the VAT (15% or R15) to the South African Revenue Services (SARS) however the Manufacturer can claim the R15 as input tax. The Manufacturer now “adds value” by producing the final product and sells the completed product to the Retailer for R230 (R200 x 15% VAT = R230). The VAT portion R30 (15% of R230) and is known as the output VAT. The Manufacturer deducts the input VAT from the output VAT and pays the difference to SARS. (R30-R15 = R15)

The Supply chain now continues as the Retailer adds his markup to the product, which is usually 100%, and then sells it to the public for R460 (R400 x 15% VAT =R460) The Retailers input VAT was R30 and output VAT is R60 so the difference the Retailer has to pay to SARS is R30

In summary, the Supplier paid SARS R15 (as there was no input tax) the Manufacturer paid R30 due to the extra value of producing the product and the Retailer also paid R30