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Thread: Telkom VAT charges

  1. #1
    just me duncan drennan's Avatar
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    Telkom VAT charges

    I was busy capturing my Telkom account and noticed that the VAT amount seems to be incorrect.

    This is the breakdown as per the bill:

    Amount = R294.97
    VAT = R41.29
    Total = R336.26

    Now to me R294.97*0.14 = R41.2958, which should be rounded up to R41.30, which is also the way my accounting package (QuickBooks) calculates it.

    Does SARS allow for VAT amounts to always be rounded down? Or is this an error with Telkom's billing system? And in terms of accounting, should it be captured exactly as it is on the bill, or with the "correct" amount?
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    Site Caretaker Dave A's Avatar
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    Most programs calculate VAT against each line item. This can result in a substantial difference over the whole bill.

    I remember a discussion somewhere (not here) that it seemed that Telkom was using the system to overcharge on VAT at one point. I haven't looked at it for some time, though.
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  3. #3
    just me duncan drennan's Avatar
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    Okay, if I do it that way it works out. Calculate vat on each item, round it, then add, and it comes to the same amount as the bill. Interesting.
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