How to Calculate VAT in South Africa: Simple Formulas & Examples

South Africa's standard value-added tax (VAT) rate is 15%, in effect since 1 April 2018. Whether you are adding the tax to an amount or extracting it from an inclusive total, the maths is straightforward once you know the formulas below.

Adding VAT (Exclusive to Inclusive)

When you have an amount excluding VAT and need to calculate the inclusive total:

Example: Your service fee is R1,000 (exclusive of tax).

• Tax portion: R1,000 × 0.15 = R150
• Total invoice amount: R1,000 + R150 = R1,150

Removing VAT (Inclusive to Exclusive)

When you have a total including tax and need to find the original amount before the levy was applied:

Example: A product costs R575 inclusive of tax.

• Exclusive amount: R575 ÷ 1.15 = R500
• Tax portion: R575 × 15 ÷ 115 = R75

Quick Reference Table

Zero-Rated Supplies (0% Rate)

Some goods and services are taxable at 0% instead of 15%. The vendor can still claim input tax on related expenses. Key zero-rated items include:

• Exports of goods or services
• Basic foodstuffs: brown bread, maize meal, samp, rice, dried beans, lentils, pilchards in tins, milk powder, eggs, fruit, vegetables, vegetable oil, dairy powder blend
• New in 2025: edible offal (sheep, poultry, goats, swine, bovine), heads, feet, bones, tongues, dairy liquid blend, and tinned/canned vegetables
• Petrol, diesel, and illuminating paraffin
• International transport services
• Certain farming inputs

Exempt Supplies (No Tax Charged)

Exempt supplies carry no tax at all, and the supplier cannot claim input tax on related expenses. This is the critical difference from zero-rated supplies.

• Financial services (interest, insurance premiums, forex)
• Residential rental accommodation
• Non-international passenger transport by road or rail
• Educational services by recognised institutions
• Childcare services