3.1 Which statement is true below? A. All businesses must be registered as VAT vendors. B. A business with a turnover of R1m and above must be registered as a VAT vendor. C. Only retailers must register for VAT. D. A business with a turnover of R600,000 and above must be registered as a VAT vendor. 3.2 Which item is zero-rated on the list below? A. Bread B. Heater C. Cooldrink D. Meat 3.3 The total of Steve's cash slip at the supermarket was R249.80 (inclusive of VAT on vatable goods). This amount includes R19 worth of zero-rated items. Calculate the amount on which VAT was calculated. A. R230.60 B. R229.80 C. R230.80 D. R268.80 3.4 Refer to 3.3 above. Assume that none of the items are zero rated, and calculate the amount of VAT that was paid. A. R32.58 B. R33.68 C. R37.47 D. R32.08

Let's go through each part of the question step by step.
3.1 VAT Registration

A. All businesses must be registered as VAT vendors.
Not true. Only businesses that meet certain criteria must register.


B. A business with a turnover of R1 million and above must be registered as a VAT vendor.
This statement is true. In many jurisdictions, including South Africa, businesses with an annual turnover exceeding R1 million must register for VAT.


C. Only retailers must register for VAT.
Not true. VAT registration depends on turnover, not the type of business.


D. A business with a turnover of R600,000 and above must be registered as a VAT vendor.
Not true. The threshold is typically higher.



Therefore, the correct answer is B.
3.2 Zero-rated Items

A. Bread
Bread is often zero-rated for VAT purposes as it is considered a staple food.


B. Heater
Typically not zero-rated; standard VAT applies.


C. Cooldrink
Usually subject to standard VAT.


D. Meat
In many places, basic food items like meat may also be zero-rated.



Therefore, the correct answer is A, Bread.
3.3 Calculating VAT on the Cash Slip

Total amount: R249.80
Zero-rated items: R19
Amount on which VAT was calculated: R249.80 - R19 = R230.80

The correct answer is C. R230.80
3.4 Calculating VAT Paid if None of the Items were Zero-rated

Total amount: R249.80
VAT rate in South Africa is generally 15%, so: VAT = 1.15 249.80 ​ × 0.15 Simplifying further to calculate the VAT paid:

Or simply: If all items were vatable: VAT = 249.80 × 115 15 ​ = 32.58
The correct answer is A. R32.58

Answered by LiamAlexanderSmith | 2025-07-21