How to Create a VAT Invoice in South Africa (With Examples)

To create a VAT invoice in South Africa, you need to be registered for VAT with SARS, charge 15% VAT on your goods or services, and include specific mandatory fields on your invoice. The VAT amount is added on top of your base price and must be shown separately on the invoice document.

This guide walks through everything step by step, with a worked example so you can see exactly how the numbers work.

What is VAT in South Africa?

Value Added Tax (VAT) is a consumption tax levied at a standard rate of 15% in South Africa. SARS introduced VAT in 1991 to replace sales tax. As a VAT vendor, you collect VAT on behalf of SARS from your customers and pay it over to SARS periodically (usually every 2 months via a VAT201 return).

You can only charge VAT on invoices if your business is registered as a VAT vendor with SARS. VAT registration is mandatory once your taxable turnover exceeds R1 million in any 12-month period. Voluntary registration is allowed once you exceed R50,000 in turnover.

When must you charge VAT?

You must charge VAT on every taxable supply of goods or services if you are a registered VAT vendor. A “taxable supply” includes most commercial goods and services. Some supplies are zero-rated (such as basic food items and exported goods) and some are VAT-exempt (such as financial services and residential rent).

If you are not VAT registered, you must not charge VAT and must not issue a tax invoice. You issue a standard invoice instead.

How to calculate VAT on an invoice

VAT in South Africa is calculated at 15% of the price before VAT (the “exclusive” amount).

Formula:

• VAT amount = Price before VAT x 0.15
• Total including VAT = Price before VAT + VAT amount

Example: If you charge R2,000 for a graphic design project:

• Price before VAT: R2,000.00
• VAT at 15%: R300.00
• Total payable: R2,300.00

Working backwards (extracting VAT from a VAT-inclusive price):

If a price is quoted as VAT-inclusive and you need to show the VAT separately:

• VAT amount = Total price / 1.15 x 0.15
• Price before VAT = Total price / 1.15

Example: If an all-inclusive price is R2,300:

• VAT amount = R2,300 / 1.15 x 0.15 = R300.00
• Price before VAT = R2,300 / 1.15 = R2,000.00

What must a VAT invoice include?

For transactions of R5,000 or more (including VAT), a full tax invoice must include these fields:

1. The words “Tax Invoice” on the document
2. Your business name and address
3. Your VAT registration number (starts with 4)
4. A unique, sequential invoice number
5. The invoice date
6. Your client’s name and address
7. Your client’s VAT number (if they are a VAT vendor)
8. A description of the goods or services
9. The quantity supplied
10. The price before VAT (subtotal)
11. The VAT rate (15%)
12. The VAT amount in rands
13. The total amount including VAT

For transactions under R5,000, an abridged tax invoice with fewer fields is acceptable. See our guide on SARS invoice requirements for the full breakdown.

Worked example: a complete VAT invoice

Here is how a typical VAT invoice looks for a South African web designer billing a client:

TAX INVOICE

From: Cape Digital Design (Pty) Ltd 12 Loop Street, Cape Town, 8001 VAT Reg: 4123456789

To: Sunrise Retail (Pty) Ltd 45 Main Road, Johannesburg, 2000 VAT Reg: 4987654321

Invoice number: INV-2026-0042 Invoice date: 16 January 2026 Payment due: 30 January 2026

Banking details: First National Bank Account: 62123456789 Branch: 250655 Reference: INV-2026-0042

Step-by-step: creating a VAT invoice in Rebill

Rebill handles all the VAT calculations and formatting automatically. Here is how to create a VAT invoice:

1. Add your VAT number in your Rebill account settings under Business Profile
2. Create a new invoice and add your client
3. Add line items with the amounts excluding VAT
4. Enable VAT on the invoice and set the rate to 15%
5. Rebill calculates the VAT amount and total automatically
6. Send the invoice via email or WhatsApp

The generated invoice is fully SARS-compliant and includes all required fields. You can customise the invoice with your logo, payment terms, and banking details.

Common VAT invoicing mistakes to avoid

Mixing up inclusive and exclusive pricing. If you quote a client R1,000 and they expect that to be the final price, adding 15% VAT on top will surprise them. Be clear in your quotes and contracts whether prices are VAT-inclusive or exclusive.

Not separating the VAT amount. SARS requires the VAT amount to be shown separately on the invoice. Writing “R1,150 (VAT included)” is not enough for a compliant tax invoice.

Forgetting to include your VAT number. Without your VAT registration number on the invoice, your client cannot claim back the input VAT they paid you.

Using the wrong VAT rate. The standard rate is 15%. Some supplies are zero-rated at 0% (such as exported goods). Make sure you apply the correct rate for each line item.

For a full list of what freelancers need to know about invoicing in South Africa, see How to Invoice as a Freelancer in South Africa.