What is happening?
On 1 April 2018 South Africa’s VAT rate will change from 14% to 15%. This will affect all VAT registered businesses based in South Africa.
What is the impact on ESP settings?
There are two things that need to happen:
- Change your global VAT rate in your system set up
- Update your price lists to reflect the new VAT calculations
There are some other implications about running certain reports in cases where you run across the old and new VAT ratings but we will release some more info on this shortly.
There is also the consideration of refunds for items purchased at the old rate but returned at the new rate. We will also comment on this further once we have considered the options available.
When do I need to change my ESP VAT settings?
The changes need to be made at the end of trading on 31 March 2018, before trading begins on 1 April 2018.
How do I change my ESP VAT settings?
To update your Global VAT percentage:
In ESP Business Manager navigate to Setup > Control Panel > Sales Settings > Sales Tax > Change the Amount to 15%.
To recalculate the cost and selling prices:
For Retail, Service, Package and Courses edit each item and update your Selling and Cost prices using the blue arrows to recalculate the including or excluding prices according to the new VAT settings.
Use ESP’s Price List manager to mass update prices
If you have the ESP Price List Manager then you have the option of mass updating including or excluding values based on the new VAT formula. If you have not purchased this module but would like to then please contact us on firstname.lastname@example.org to make arrangements.
Anything else I need to know?
If any further information or implications become clear to us we will publish them on our web site.
In the meantime we strongly recommend that you start planning for the VAT increase now. Nominate a person who will be responsible for this in your business and make sure that they know what they need to do when they are going to do it well in advance.
We will not be in a position to do this on behalf of all our clients and so need everyone to prepare as best they can in advance.