Four places to check that the new 15% VAT rate on your Xero in South Africa account is updated.
How to make a story about VAT interesting, hmmm.
VAT, like it’s family of other tax types, is interesting only in that knowing about it can keep us out of trouble with those peeps in the dark corridors of the Revenue Services – a.k.a. SARS.
The standard rate of value added taxation (VAT) in South Africa has only been raised once since its inception in 1991. That is until 2018, when the rate increased by 1% to 15%.
Xero prepared for this ahead of time by automatically creating the new VAT rate in all South African Xero accounts, while keeping the old rate of 14% as well.
Let’s jump straight into the four places where you need to manually update the old rate to the new one as a tax type.
The first is in your chart of accounts:
The easiest way to do this would have been by downloading the accounts, making the changes in the downloaded csv, and re-uploading them. This can be a little confusing as the Old VAT rates show as New VAT rates when you download the file. But when you upload, the file again, it will override the old rates with the new ones.
If you don’t have joy with the csv bulk change method, you can update each individually in your chart of accounts:
The second place is in your repeating invoices:
If you have one or more repeating invoices set up, you’ll need to open each one individually, update the VAT rate, and resave it.
The third place is in Bank Rules:
You can access your bank rules page by opening your bank recon page, and you’ll find Bank Rules by clicking on the Manage Accounts button.
Remember to open each one under both Spend Money and Receive Money tabs, edit the VAT rate and save it again.
The fourth place to manually update your VAT rate is in your Inventory list.
Whether you use tracked or untacked inventory (or a combination), and whether they are products or services, you’ll need to update the VAT rate individually.
If you aren’t already using Xero for your business, or you’d like to find out more about getting the best outsourced services for your monthly bookkeeping, book a free scoping session here.
Or enjoy a fat Xero discount on a new subscription for South African businesses here.