Spa price lists and VAT at the till
Whether a South African spa's treatment and product prices on the till should include VAT, how each line is taxed, and what the client's receipt shows.
By Achekam · · 5 min read · For Fitness businesses in South Africa
A client reads your treatment menu, books a hot-stone massage, and on the way out picks up a body oil from the retail shelf. At the till she expects to pay exactly what the menu and the shelf label said. If the till adds VAT on top, you have an unhappy client and a receptionist explaining tax at the counter. If the menu already included VAT but the till treats the price as excluding it, you have quietly overcharged her.
For a South African spa registered for VAT, the price list and the till must agree on one thing: is VAT inside the price or not? This article explains the setting that decides it, how each line is taxed, and what the client sees on her receipt.
One setting decides how prices are read
On Achekam's till, the business sets whether shelf prices include VAT. That one choice tells the till how to read every price you have entered: as the amount the client pays, with VAT inside it, or as an amount VAT is added to.
For a spa selling to the public, the choice usually follows your menu. Clients compare the price on the menu with the price at the till, and quoting VAT-inclusive prices is among the duties SARS lists for a registered vendor. SARS's page on the obligations of a VAT vendor sets out what a registered vendor must do: charge VAT on taxable supplies, quote VAT-inclusive prices, issue tax invoices, keep records for five years, and submit the VAT201 and pay on time.
Whatever you choose, make the setting, the menu and the shelf labels say the same thing before you go live, and do not change it casually afterwards.
Each line is taxed at its own rate
The till does not apply one rate to the whole basket. Each line is taxed at its product's own VAT rate, so a product set at 0% stays at 0%, and otherwise the line is taxed at South Africa's approved standard rate.
That makes the VAT treatment you give each product at set-up the thing that matters. Products and treatments are created in the Item Master with their SKU, name, category, selling price, cost price, opening quantity and VAT treatment. No screen lets a business change a product's price, cost or VAT treatment after it is created, so decide each item's treatment with your accountant before you save it.
One limit to know about: a product marked Exempt in the Item Master is recorded at the till, and on the VAT return, as zero-rated, because the exempt or zero-rated choice is never saved on the product. If your accountant tells you any item you sell is exempt, agree how it will be handled before it is rung up.
The standard rate and the date it took effect
South Africa's standard VAT rate has been 15% since 1 April 2018, and it was 14% before that. Achekam holds 15% as an approved rule, effective from 1 April 2018, and the till applies it to every standard-rated line.
Rates do change, so if you are reading this some time after it was written, check SARS's own pages for the rate in force.
A worked example in words
A client has a facial and buys a cleanser from the retail shelf. The spa's setting says prices include VAT, and both the treatment and the cleanser were set up as standard-rated. The till charges the client exactly the menu price and the shelf price, and works the VAT out of each one at the standard rate. The client pays by card. Her receipt lists both items, the payment, and VAT by rate.
Had the spa set its prices to exclude VAT, the same two items would have cost her the menu price plus VAT, and the receptionist would have been explaining why.
Gift vouchers are different
Spa vouchers are popular gifts, and they are treated differently from treatments. Gift vouchers are sold at the till with a code, held as a liability until redeemed by that code, and sold without VAT. In South Africa a voucher lasts at least 36 months. The full picture, including what happens when a voucher is redeemed for a treatment, is in spa gift vouchers.
Sales by VAT rate for any period
At the end of each VAT period you need to know how much you sold at each rate. Posted till sales can be listed by VAT rate and tax code for any period, and the VAT return calculations read posted till sales. Treatments and retail products are both in there, each at its own rate.
Achekam does not prepare, store or submit your VAT201, and nothing is submitted to SARS eFiling. You or your accountant complete the return from these figures and submit it. If your spa also sells mixed baskets in a retail area, VAT on mixed-rate baskets shows how the lines add up.
What the receipt shows the client
The till receipt is a PDF made by the server from the posted sale. It shows every payment, VAT by rate and the business's tax number, and it can be printed, downloaded or e-mailed to the client. Clients claiming treatments back from an employer's wellness benefit, for instance, can then forward it.
Make sure your VAT registration number is entered in Settings under Firm Profile; documents made by the server print it and are titled Tax Invoice only when a VAT number is set.
For the products on your retail shelf, selling supplements and drinks at the front desk covers stock and cost of sales.
Before you open the till
- The VAT-inclusive setting matches your menu and shelf labels.
- Every treatment and product has the right VAT treatment, checked with your accountant.
- Your VAT number is in Settings.
- Staff know vouchers are sold without VAT.
Get the setting and each product's VAT treatment right at the start, and the price on the menu is the price at the till, with the VAT worked out for you on every receipt.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
