How To Calculate VAT In Namibia

How To Calculate VAT In Namibia

What is VAT?

A value-added tax, known in some countries as a goods and services tax, is a type of tax that is assessed incrementally. It is levied on the price of a product or service at each stage of production, distribution, or sale to the end consumer.

How To Calculate VAT In Namibia

You can calculate VAT in Namibia by multiplying the product or service price by the appropriate VAT rate.

2022 Intakes in Namibia [Universities, Colleges, VTC Intake]

Namibia VAT formula

Value Added Tax in Namibia is calculated using the following VAT formula:

VAT = a x (b / 100)

Where:

• a = The product/service that is subject to VAT in Namibia.
• b = The relevant rate of VAT in Namibia associated with the product/service.

VAT Rates in Namibia

The table below specifies the relevant VAT rates applicable in Namibia, these were last updated in line with the published VAT rates in 2020.

When must you register for VAT in Namibia?

Value Added Tax (VAT) – Act 10 of 2000

A registered person must submit a VAT return on or before 25th day of the month following the end of the period.

Is it better to be VAT registered?

So, if your turnover exceeds the VAT threshold of £85,000 then you must register for VAT. Registering for VAT can ensure that you are ready to grow as a business – creating a positive impression about your intent – and allows you to reclaim VAT on purchases you make.

Is interest paid Vatable in Namibia?

Interest. A WHT of 10%, calculated on the gross amount of interest, is payable on interest accruing to any person, other than a Namibian company, from a registered banking institution or unit trust scheme in Namibia. The tax withheld is a final tax, and the financial institution is responsible to withhold the tax.

How does Namibia tax work?

A sliding scale is used to determine the tax rates applicable to individuals. For all years of assessment effective 1st March 2009, the minimum rate is 0% and the maximum rate applied is 37%. The Namibian tax year commences on 1 March to the last day of February that subsequent year.

What is the purpose of VAT?

The Value Added Tax, or VAT, in the European Union is a general, broadly based consumption tax assessed on the value added to goods and services. It applies more or less to all goods and services that are bought and sold for use or consumption in the European Union.

How do we calculate VAT?

Take the gross amount of any sum (items you sell or buy) – that is, the total including any VAT – and divide it by 117.5, if the VAT rate is 17.5 per cent. (If the rate is different, add 100 to the VAT percentage rate and divide by that number.) Multiply the result from Step 1 by 100 to get the pre-VAT total.

How do I calculate VAT back?

To calculate VAT having the gross amount you should divide the gross amount by 1 + VAT percentage. (i.e if it is 20%, then you should divide by 1.20), then subtract the gross amount.

How do you add VAT to a price?

If you want to add VAT to the price, you just need to divide the price by 100 and then multiply by (100 + VAT rate). That’s all, you got the price including VAT – Gross price.

Are donations tax deductible in Namibia?

A specific deduction for donations is allowed, provided that it is made to a registered welfare organisation or an approved educational institution. However, this deduction may not create or increase a tax loss.

What is Namibia withholding tax?

A WHT of 10%, calculated on the gross amount of interest, is payable on interest accruing to any person, other than a Namibian company, from a registered Namibian banking institution or unit trust scheme. The tax withheld is a final tax, and the financial institution is responsible to withhold the tax.

Is income tax paid monthly or yearly?

Income tax is applicable to be paid by individuals, corporates, businesses, and all other establishments that generate income. Even though income tax is paid every month from the monthly earnings, it is calculated on an annual basis. The amount of income tax an individual has to pay depends on a number of factors.

Do you pay tax on dividends in Namibia?

Dividends – Dividends paid to nonresidents and certain foreign held residents are subject to NRST at 10%, unless the rate is reduced under an applicable tax treaty. Interest – Both residents and nonresidents are taxable on Namibian interest income (subject to certain exemptions and tax treaty relief).

Is tax calculated on gross or net income?

In this case, income tax is based on the gross salary of the employee and is deducted as a source by the employer. Moreover, the basic salary of an employee should be at least 50-60% of his/her gross salary. Let’s assume Mr. Dhruv falls between the salary range of Rs 2,00,001-Rs 5,00,000 and comes under 10% tax-slab.

Is rental income taxable in Namibia?

premises, land, building, house, backyard flat, and office space. Income received from any agreement for the usage of the property is taxable, provided that such a property is situated in Namibia. Money paid to terminate the rental agreement is also taxable and should be included in the income for the year.

Is there capital gains tax in Namibia?

There is no capital gains tax in Namibia. Namibia also has thin capitalisation rules in terms of which the deduction of interest may be disallowed.

Is a bonus taxable in Namibia?

Bonuses are paid at the end of each tax year and accrue evenly throughout the year. The company car, with a cost of USD50,000 is used for both business and private and the employer is responsible for maintenance and petrol costs, i.e. the taxable benefit will be 18 percent of the cost of the car per annum.

How do I complete a tax return in Namibia?

1. STEP 1: Complete your personal details. Fill in your offices of registration (for e.g. Windhoek, Keetmanshoop, Walvis Bay)
2. STEP 2: Complete the back of the return now.
3. STEP 3: Complete the rest of the information on the front of the return.

Is foreign income taxable in Namibia?

Namibia has a source based system of taxation with the result that Namibian residents are, save for some exceptions, only taxed on their Namibian income while foreign residents are taxed only on the income generated within Namibia.

Are donations tax deductible in Namibia?

A specific deduction for donations is allowed, provided that it is made to a registered welfare organisation or an approved educational institution. However, this deduction may not create or increase a tax loss.

Is pension taxable in Namibia?

Pension and RA funds – The total lump sum is tax-free, but the annuities /pensions paid to dependants are taxable at the marginal rate. The difference being paid as annuities, will be taxable.

Is housing allowance taxable in Namibia?

Taxation of Fringe Benefits:

Housing allowance is taxable, however 1/3 is exempt if the employer has an approved housing scheme; The use of a company car is taxable at 1.5% if all costs are paid by the employer and 1.4% if you as an employee pays the fuel cost.