60.1K

Verified Solution

Link Copied!

15% VAT rate

Earlier this year, two friends spotted an opportunity around a major soccer tournament and decided to start a business selling vuvuzelas and earplugs. They formed a close corporation, VuvuEars cc, and because of a number of factors, only began operating on 1 January (their year end is the end of February). The business exceeded all expectations, and took off at a tremendous rate. VuvuEars cc achieved a total turnover of R1.71 million by the end of February, and is registered for VAT for strategic marketing purposes (as they are seen as more appealing to government clients that way). This turnover figure is including VAT, though, as the members were not sure how to do the VAT calculation to figure out the "exclusive of VAT number. They have been told by their bookkeeper that their qualifying tax deductions are R969 000 and that that number is inclusive of VAT as well. (Note: For the purposes of this scenario, please ignore any timing issues with regard to when VAT should have been paid.) What is their output VAT for the applicable two-month period? Select one: 0 a. R223 043 O b. R256 500 O c. R126 391 O d. R145 350 What is their input VAT for the applicable two-month period? Select one: O a. R223 043 b. R256 500 O c. R126 391 O d. R 145 350

Answer & Explanation Solved by verified expert

See Answer