VAT explained (South Africa)
Understand VAT inclusive vs exclusive pricing, with a quick and accurate way to convert between them.
VAT inclusive vs VAT exclusive
If a price is VAT exclusive, VAT gets added on top. If a price is VAT inclusive, the VAT is already included.
Common mistake
People often subtract 15% from a VAT-inclusive price to get the exclusive price — but that’s not correct. The correct method is:
- Exclusive = Inclusive ÷ (1 + VAT rate)
- VAT = Inclusive − Exclusive
Use the VAT calculator to switch between inclusive and exclusive amounts instantly.
Keep it practical
If you’re quoting prices for work or invoices, always confirm whether your price is VAT inclusive or exclusive and keep your wording consistent.