New VAT Rate 2018

By Dynamitech

On the 21st of February 2018 the Minister of Finance announced an increase in VAT - from 14% to 15%, effective from 1 April 2018.

This means that, if your business is VAT registered, you must charge the new rate of 15% on services rendered or goods delivered after 1 April 2018. Although this may sound simple enough, there are a few exceptions.

  • Where an agreement to deliver goods was entered into before 1 April 2018, such goods can still be delivered and invoiced for at the current VAT rate (14%) if such products are delivered on or before 21 April 2018. An example is stock that must be ordered from overseas.
  • In the event where invoice was issued before 1 April 2018, and payment is being made in installments, the installments may NOT be increased, even if installments are being paid after 1 April 2018. An example is Vehicle Finance.
  • If you entered into a contract before 1 April 2018 for services to be rendered on a monthly basis after 1 April 2018, the services rendered after 1 April 2018 will be charged at the new VAT rate (15%). An example is a Cell Phone Contract.

The examples above are common scenarios. There are some other rules for other scenarios, so if you are unsure, please contact one of our Accountants to assist.

2018 New Vat Rate Article