Grade 11 · CAPS
Grade 11 Value-Added Tax (VAT)
Accounting practice questions and a worked example
Grade 11 Accounting VAT questions ask you to explain terms such as output VAT, input VAT and zero-rated items, and to calculate VAT from amounts that include or exclude VAT at 15%, including the input VAT a business may claim. They come from the Eastern Cape Department of Education’s Grade 11 November papers for 2023, 2024 and 2025, each with the answer from the marking guideline.
Worked example
QUESTION 4: VAT AND FIXED ASSETS
4.1 VALUE ADDED TAX (VAT)
Lashes Traders is a registered VAT vendor. He stocks goods that are zero-rated as well as goods that are subject to the standard VAT rate of 15%.
4.1.1 Provide ONE explanation why some goods are classified as zero-rated.
Answer & explanation
ONE valid explanation:
• The government wants all citizens to be able to afford these goods.
• These goods are deemed to be necessary goods that are accessible to the poor.
• The government can place a VAT rate on these goods in the future if additional government funding is needed.
Zero-rated goods are those that are considered essential for daily living, such as basic food items. By classifying these goods as zero-rated, the government ensures that they remain affordable for all citizens, including those with lower incomes. This helps in reducing the cost of living and supports economic equity. Additionally, zero-rating these goods allows the government to have the flexibility to impose VAT on them in the future if there is a need for increased revenue.
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Question 1 of 3
QUESTION 4: VAT AND FIXED ASSETS
4.1 VALUE ADDED TAX (VAT)
Lashes Traders is a registered VAT vendor. He stocks goods that are zero-rated as well as goods that are subject to the standard VAT rate of 15%.
4.1.2 Calculate the missing amount in the table provided:
AMOUNT EXCLUDING VAT | VAT AMOUNT | AMOUNT INCLUDING VAT
86 000 | (i) | 98 900
98 000 | (ii) |
| (iii) | 62 790
| 11 910 | (iv)
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More practice questions
Explore additional Grade 11 Value-Added Tax (VAT) questions.
- 2QUESTION 4: VAT, PROBLEM SOLVING AND ETHICS 4.1 VAT You are provided with information relating to Mia’s Fresh Picks for the month October 2024. The business uses the perpetual inventory system and buys and sells all its goods for cash. The standard VAT rate is 15%.4.1.2 Why does government classify certain items as zero-rated for VAT? Name TWO zero-rated items.
- 3QUESTION 4: VAT, PROBLEM SOLVING AND ETHICS 4.1 VAT You are provided with information relating to Mia’s Fresh Picks for the month October 2024. The business uses the perpetual inventory system and buys and sells all its goods for cash. The standard VAT rate is 15%.4.1.3 Briefly explain to Mia what is meant by Output VAT and Input VAT.
- 4QUESTION 4: VAT, PROBLEM SOLVING AND ETHICS 4.1 VAT You are provided with information relating to Mia’s Fresh Picks for the month October 2024. The business uses the perpetual inventory system and buys and sells all its goods for cash. The standard VAT rate is 15%. INFORMATION B: Mia bought goods on credit from suppliers for R62 974, including 15% VAT. She also bought goods for R12 800 that were zero-rated VAT items.4.1.5 Refer to INFORMATION B: Consider the information in regards to the goods purchased from suppliers during October 2024. Calculate: • VAT on these goods • The cost of all goods purchased, excluding VAT
- 5QUESTION 1: PERIODIC SYSTEM, VAT AND FIXED ASSETS 1.2 VAT Siyanda Traders is a VAT-registered business. The VAT rate is 15%. The following transactions took place in May 2025: (i) Cash sales of goods: R11 500 (VAT included) (ii) Credit purchase of goods: R6 900 (VAT excluded) (iii) Purchase of a motor car for the owner’s personal use: R450 000 (VAT included) (iv) Paid for repairs to the delivery vehicle: VAT: R2251.2.1 Calculate the VAT amount included in the cash sales.
Common mistakes
- Taking 15% of an amount that already includes VAT. The VAT in R11 500 is 11 500 × 15/115 = R1 500.
- Claiming VAT on private purchases. A motor car bought for the owner’s personal use is excluded from input VAT claims.
- Treating zero-rated goods as if they carried VAT. The cost excluding VAT is (62 974 – 8 214) + 12 800 of zero-rated goods = 67 560.
More Grade 11 Accounting topics
Aligned to CAPS Grade 11 Accounting — Value-Added Tax (VAT). Curriculum source: CAPS for the FET Phase, Department of Basic Education.
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