The rate
The standard rate of VAT in South Africa is 15%. Some supplies are zero-rated, which means VAT applies at 0%, and some are exempt, which means VAT does not apply at all. Those are different things, and they are treated differently on a VAT return.
Adding VAT to a VAT-exclusive price
This is the case when you have priced the work and now need to add VAT on top.
- VAT amount = price × 0.15
- Total including VAT = price × 1.15
On R2,000 excluding VAT: the VAT is R300, and the total is R2,300.
Working out the VAT inside a VAT-inclusive price
This is the case when you have been given a single figure — a till slip, or a client who says 'the job is R5,000 all in' — and you need to know how much of it is VAT.
- VAT amount = inclusive amount × 15 ÷ 115 (the same as dividing by 7.666…)
- Amount excluding VAT = inclusive amount ÷ 1.15
On R5,000 including VAT: the VAT is R652.17 and the amount excluding VAT is R4,347.83.
Quick reference
| Excl. VAT | VAT @ 15% | Incl. VAT |
|---|---|---|
| R100.00 | R15.00 | R115.00 |
| R500.00 | R75.00 | R575.00 |
| R1,000.00 | R150.00 | R1,150.00 |
| R4,347.83 | R652.17 | R5,000.00 |
| R8,695.65 | R1,304.35 | R10,000.00 |
Rounding, and why totals drift
If you calculate VAT line by line and round each line to two decimals, the sum can differ by a cent or two from VAT calculated on the invoice total. Neither is wrong, but be consistent — pick one approach and use it on every document, so a client comparing two of your invoices does not find a discrepancy to query.
This is not tax advice
These are the arithmetic mechanics. Whether you must register, what rate applies to a particular supply, and how to complete a return are questions for a registered practitioner or the current SARS guidance.