VAT & Tax

Calculate VAT, understand SARS and tax returns

VAT and Tax Returns

VAT (Value Added Tax) is 15% added to the price of most goods and services in SA. Businesses collect VAT from customers and pay it to SARS. Some basic foods are zero-rated (no VAT) to protect the poor. Businesses registered for VAT must submit regular returns to SARS.

Example

Calculating VAT

Price excluding VAT: R100 VAT (15%): R100 × 0.15 = R15 Price including VAT: R115 To find VAT in an inclusive price: Price incl. VAT: R230 VAT = R230 × 15/115 = R30 Price excl. VAT = R230 - R30 = R200 Zero-rated items (no VAT): brown bread, milk, eggs, rice, vegetables, fruit

Note

Remember

VAT is a consumption tax — everyone pays it when buying goods. It's regressive (affects poor people proportionally more). That's why basic foods are zero-rated. Businesses with turnover above R1 million must register for VAT. Tax compliance is a legal duty — SARS has serious penalties for non-compliance.

Key Vocabulary

VATValue Added Tax — 15% tax on most goods and services

Zero-ratedItems that have 0% VAT (basic foodstuffs)

Tax returnA form submitted to SARS declaring income and tax owed

SARSSouth African Revenue Service — collects all tax

SASL Avatar

Loading avatar...

1 / 4

VAT

Speed: