{"id":550,"date":"2018-03-19T11:38:36","date_gmt":"2018-03-19T09:38:36","guid":{"rendered":"https:\/\/sage-new-clone.local\/en-za\/blog\/?p=434"},"modified":"2026-02-04T16:50:17","modified_gmt":"2026-02-04T14:50:17","slug":"vat-opportunities-for-small-businesses","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-za\/blog\/vat-opportunities-for-small-businesses\/","title":{"rendered":"Hidden VAT opportunities for small businesses"},"content":{"rendered":"<header class=\"entry-header has-dark-background-color entry-header--has-illustration entry-header--has-illustration--generic\">\n\t<div class=\"container\">\n\t\t<div class=\"entry-header__row row align-center\">\n\t\t\t<div class=\"col col-lg-7 col-xlg-6 entry-header__content\">\n\t\t\t\t\t\t\t<div class=\"component component-single-header\">\n\t\t\t\t\t\t\t\t\t\t<div class=\"entry-header__misc text--subtitle text--uppercase text--small\">\n\t\t\t\t\t\t\t<a href=\"https:\/\/www.sage.com\/en-za\/blog\/category\/money-matters\/\" class=\"entry-header__link\">Money Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t<div class=\"entry-title-wrapper\">\n\t\t\t\t\t<h1 class=\"entry-title\">\n\t\t\t\t\t\tHidden VAT opportunities for small businesses\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t<p class=\"entry-header__description\">\n\t\t\t\t\t\t\t\t\t\t\t<\/p>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n\t<div class=\"single-post-details container\">\n\t\t<div class=\"col\">\n\t\t\t<span class=\"posted-on \"><time class=\"entry-date published\" datetime=\"2018-03-19T11:38:36+02:00\">March 19, 2018<\/time><\/span><span class=\"reading-time\"> min read<\/span>\n\t\t<button\n\t\t\ttype=\"button\"\n\t\t\tclass=\"social-share-button button button--icon button--secondary js-social-share-button\"\n\t\t\tdata-share-title=\"Hidden VAT opportunities for small businesses\"\n\t\t\tdata-share-url=\"https:\/\/www.sage.com\/en-za\/blog\/vat-opportunities-for-small-businesses\/\"\n\t\t\tdata-share-text=\"Please read this interesting article\"\n\t\t>\n\t\t\t<span class=\"social-share-button__share-label\">Share<\/span>\n\t\t\t<span class=\"social-share-button__copy-label\" hidden>Copy Link<\/span>\n\t\t\t<span class=\"social-share-button__copy-tooltip\" aria-hidden=\"true\" hidden>Copied<\/span>\n\t\t<\/button>\n\n\t\t\t\t<\/div>\n\t<\/div>\n<\/header>\n\n\n\n<div class=\"wp-block-post-author has-dark-background-color alignfull\">\n\t<div class=\"container\">\n\t\t<div class=\"col\">\n\t\t\t\t\t\t\t<div class=\"co-authors\">\n\t\t\t\t\t\n\t\t<div class=\"entry-author-wrapper\">\n\t\t\t<a class=\"entry-author\" href=\"https:\/\/www.sage.com\/en-za\/blog\/author\/vireshharduth\/\">\n\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"40\" height=\"40\" src=\"https:\/\/www.sage.com\/en-za\/blog\/wp-content\/uploads\/sites\/9\/2020\/04\/Viresh-Harduth-Sage-2-350x350.jpg\" class=\"entry-author__image\" alt=\"\" \/>\t\t\t\t<span class=\"entry-author__name\">Viresh Harduth<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n<p>The VAT increase, which comes into effect in just 13 days, is an opportunity for Small &amp; Medium Businesses to review their processes and identify opportunities to cut costs and streamline operations.<\/p>\n\n\n\n<p>For more than 25 years, the VAT rate has remained unchanged at 14%. Unlike with income tax, many businesses have never had to adjust their systems or train their teams on new VAT rates. Until now.<\/p>\n\n\n\n<p>In preparing for the adjustment, your small business should grab the opportunity to review all other areas of your business and figure out where you can do more with less.<\/p>\n\n\n\n<p>Here are a few ways to do that:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Take stock<\/strong>. You will need to adjust the prices of all your products \u2013 unless they are zero-rated \u2013 to reflect the new VAT rate. This has to be done by 31 May. While you\u2019re at it, you might as well do a stock audit and work out what is selling and what isn\u2019t, the latter of which you could put on sale to try and move the stock and give your business a cash flow boost.<\/li>\n\n\n\n<li><strong>Automate wherever possible<\/strong>. If you\u2019re still using spreadsheets and other manual systems to keep VAT records, now is the perfect time to switch to a cloud-based accounting solution, like\u00a0<a href=\"https:\/\/www.sage.com\/en-za\/sage-business-cloud\/accounting\/\">Sage Business Cloud Accounting<\/a>. Automated systems eliminate many of the headaches and admin associated with tax compliance and ensure that all your invoices, credit and debit notes comply with the \u2018time of supply\u2019 clause in the VAT Act. Cloud-based software also optimises your record-keeping, maximising the expenses you can claim back from SARS.<\/li>\n\n\n\n<li><strong>Cut costs<\/strong>. Initially, the new VAT rate may force small businesses into cash flow problems as they balance VAT charged to their customers with the VAT they will need to pay their suppliers. Shop smarter and aim to process all stock purchases on or before 31 March so that you only pay 14% VAT. You can then sell the stock at 15% VAT and put the balance back into your business.<\/li>\n\n\n\n<li><strong>Upskill your team<\/strong>. There\u2019s no better reason or opportunity to train your team than a change in regulations. VAT has not increased in 25 years, so it\u2019s likely that your team is not familiar with the VAT Act. Set up some time with your accountant, who can clearly explain the \u2018time of supply\u2019 clause to your team. They\u2019ll need to know how to correctly process sales and refunds that occur before and after 1 April. Your accountant can also provide refresher training on all tax laws to ensure your business remains compliant.<\/li>\n<\/ul>\n\n\n\n<p>While VAT should not be seen as a cost to the business, smaller businesses might have to spend money to become compliant, e.g. by printing new price labels, shutting down shop for a day to prepare, and investing in team training.<\/p>\n\n\n\n<p>However, if you also view the VAT change as an opportunity to review your processes, you could identify problem areas and growth opportunities, which will leave your business in a much stronger position than before.<\/p>\n\n\n\n<div class=\"single-cta\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">Get your free 30-day Sage Business Cloud Accounting software trial to boost your business.<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p>Reduce time spent on admin by up to 80%<\/p>\n<p>Free yourself from admin with easy-to-use features, built around you. Ideal for entrepreneurs, start-ups, and growing businesses.<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"https:\/\/www.sage.com\/en-za\/sage-business-cloud\/accounting\/\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\tid=\"cta-id-620\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tdata-button-location=\"cta_box\"\n\t\t\t\t\t\t\t\t\t\t\t>Sign Up<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"1064\" height=\"810\" src=\"https:\/\/www.sage.com\/en-za\/blog\/wp-content\/uploads\/sites\/9\/2019\/04\/GettyImages-619403886-1064x810.jpg\" class=\"single-cta__image\" alt=\"Small business accountant\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-za\/blog\/wp-content\/uploads\/sites\/9\/2019\/04\/GettyImages-619403886-1064x810.jpg 1064w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>\t\t\t\tThe Finance Minister and Treasury have proposed some tough measures to address South Africa\u2019s tax collection shortfall, growing budget deficit, and new spending priorities such as free education. Higher VAT, fuel levies and import duties on luxury goods will no doubt crimp consumer spending, which could be bad news for smaller businesses.\t\t<\/p>\n","protected":false},"author":812,"featured_media":365,"menu_order":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sage_video":false,"post_featured_image_hide":false,"footnotes":""},"categories":[35,30,25],"tags":[207,208,213],"business_type":[2,5],"lilypad":[],"context":[],"industry":[],"persona":[6,15,16],"imagine_tag":[51,71,73,85],"coauthors":[413],"class_list":["post-550","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-compliance","category-daily-money","category-money-matters","tag-sales-management","tag-saving-money-in-business","tag-tax","business_type-small-business","business_type-accountants"],"sage_meta":{"region":"en-za","author_name":"Viresh Harduth","featured_image":"https:\/\/www.sage.com\/en-za\/blog\/wp-content\/uploads\/sites\/9\/2019\/04\/GettyImages-548563905_super.jpg","imagine_tags":{"51":"Accountants","71":"Making Tax Digital for businesses","73":"Money Matters","85":"Small business"}},"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"Sage Advice South Africa","distributor_original_site_url":"https:\/\/www.sage.com\/en-za\/blog","push-errors":false,"_links":{"self":[{"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/posts\/550","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/users\/812"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/comments?post=550"}],"version-history":[{"count":0,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/posts\/550\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/media\/365"}],"wp:attachment":[{"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/media?parent=550"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/categories?post=550"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/tags?post=550"},{"taxonomy":"business_type","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/business_type?post=550"},{"taxonomy":"lilypad","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/lilypad?post=550"},{"taxonomy":"context","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/context?post=550"},{"taxonomy":"industry","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/industry?post=550"},{"taxonomy":"persona","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/persona?post=550"},{"taxonomy":"imagine_tag","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/imagine_tag?post=550"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/www.sage.com\/en-za\/blog\/api\/wp\/v2\/coauthors?post=550"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}