V.A.T
Value added tax (VAT) is charged as a percentage of the price of a product or service. So the first thing we need to know is how to calculate a percentage. The way I like to think of percentages is to break up the word into “per” and “cent”. And since “cent” is short for “century” (think a hundred in years and cricket), percent means “per hundred”. The current VAT rate is 15% – 15 per hundred – meaning you pay R15 of VAT per R100 of cost. For something that costs R100 excluding VAT, we just need to add the R15 VAT to the price, giving us a total of R115 including VAT. To calculate the VAT payable on any amount, it helps to remember that VAT is charged as a percentage “of” the purchase price. And in maths, the word “of” simply means to multiply. To calculate the VAT (15%) of something that costs R25 means we need to multiply R25 by 15%. And since we now know that 15% is just (15/100) we can multiply it by R25. Like this: To get the total cost including VAT, we add the VAT