VAT Rate Change Procedure

Why Use This Function:

Ensuring a smooth VAT rate change in the Practice is essential for legal compliance, accurate billing, and financial stability. If the VAT rate is not updated correctly, the Practice risks incorrect billing, which can lead to disputes with Patients and Debtors, as well as potential penalties from SARS for tax inaccuracies. Failure to adjust VAT on stock and supplier costs may impact profitability, while errors in invoicing and reporting can disrupt daily operations. Additionally, incorrect VAT calculations could result in cash flow issues, forcing the Practice to cover unexpected tax shortfalls or process unnecessary refunds. However, updating the VAT rate correctly provides several benefits, including ensuring legal compliance, maintaining accurate billing, and supporting smooth financial management. It also guarantees that stock and supplier pricing aligns with the new VAT rate, improves operational efficiency by reducing errors and disruptions, and strengthens the Practice's reputation for professionalism and reliability. By following a structured VAT Rate Change Procedure, the Practice ensures accuracy, financial stability, and compliance, allowing it to continue delivering high-quality medical services without unnecessary disruptions.

💡Please Note: These changes are only applicable to South African sites.


The Contents of This User Manual:

  • Basics of VAT 
  • How VAT Affects Different Transactions
  • Update the Desktop Site 
  • Change the Ledger VAT Rate in GXManage
  • Linking the New VAT Rate per Medical Aid


Basics of VAT 
VAT (Value Added Tax) is an indirect tax charged on goods and services, collected by businesses at the point of sale (during invoicing) and later paid to SARS. In South Africa, prices are usually displayed including VAT so that consumers see the final amount they must pay.

  • ​In March 2025, South Africa's National Treasury proposed a phased increase in the Value-Added Tax (VAT) rate to address budgetary needs:​
    • May 1, 2025: VAT is set to rise from 15% to 15.5%.​
    • April 1, 2026: A further increase to 16% is planned.​
  • The initial VAT increase is scheduled to take effect on May 1, 2025, even if the budget has not been passed by Parliament. ​



How VAT Affects Different Transactions

The VAT on sales (Debtors’ Invoices) is calculated when the system generates the invoice. The VAT amount essentially works by extracting the VAT-exclusive price from the inclusive price and splitting the two. This applies in the same way to tariffs and stock.

  • GoodX publishes VAT-inclusive tariff prices and pushes them via Odoo. Since we collect it ourselves, we need to ensure that it is done and that extra internal processes don't affect the roll-out of new tariffs. For more information on how to push packages from Odoo, please refer to the user manual: Price Update from Odoo.
  • We receive Stock pricelists at a VAT-inclusive price from Medprax, making us dependent on them to calculate it correctly.
  • The VAT calculation percentage is determined by the ledger linked to the item (usually INC1 for tariffs, INC2/INC3 for stock) and the Transaction Date.
  • Creditors: Users enter the sales price and VAT. They match the supplier's calculation, as shown on the Invoice received. We use the VAT amount exactly as it is calculated in the supplier's system.
  • Journals: VAT is calculated based on the ledger to which it is posted but can be overridden by the user.
  • Cashbook Transactions: Most cashbook transactions do not include VAT with the exception of a direct purchase. Sometimes, suppliers are paid directly without using a creditor account. The same rule applies as with Creditors.


Update the Desktop Site

Ensure that the Desktop version has been updated to the newest available version that supports the VAT Rate rollover.

💡Please Note: VAT Rate changes will occur automatically on Cloud Sites unless a request is logged for an early roll-out. Server Sites will need to be manually updated.


Change the Ledger VAT Rate in GXManage

  • From the GoodX Manager screen.


  • Click on the Global Lists menu.


  • Click on Ledgers on the sub-menu.


  • Click on VAT Types on the sub-menu.


  • The VAT Type screen will open.


  • Select the Standard option.


  • Click on the Setup tab.


  • Click on the From Date drop-down menu and select the date when the new VAT rate will come into effect from the date picker that becomes available.


  • Click on the Percentage field to enter the New VAT Rate.


  • Click on the Add/Update button to save.


  • The new VAT Rate will be added to the screen.


  • Repeat these steps for all the VAT Rates that have the previous VAT Rate value.

💡Please Note: It is imperative that all the specific rates are updated to the new VAT Rate as each one has a different effect on different transactions.

💡Please Note: If the date is filtered to a date before the change, the rate will still be on the old rates.
  • Click on the OK button to save and close.


  • The new VAT Rate will now take effect from the date that was selected.

Initialise a Price Collection for the New VAT Rate. 

💡Please Note: Each Price Collection needs to be initialised individually.

  • Pricelists can be initialised manually. If available, the list can also be initialised by pushing the latest published version from Odoo. This method will not initialise local prices. For more information on how to push packages from Odoo, please refer to the user manual: Price Update from Odoo.

  • Click on the Price List Management button.


  • The Pricelist Collection (PLC) screen will open.


  • Double-click on the desired Pricelist.


  • The selected pricelist's List screen will open. 


  • Click on the Update Price Lists button. 


  • The GoodX Price Updating Tool screen will open.


  • Click on the Maintain Local Pricelists button.


  • The Price Lists screen will open.


💡Please Note: The new VAT Rate will automatically be available in the VAT Rate drop-down menu.



    • Click on the Procedures button to access the Procedure Codes that are available on the desired price list.


    • The Procedure Price List screen will open, of the price list that has been selected. 

💡Please Note: All the prices will be at 0.00% because the Fixed Prices have not been recalculated for that rate and the Unit Prices have not been populated.


💡Please Note: The correct prices will need to be generated at the new VAT Rate.

    • Click on the Generate Prices for Rate drop-down menu to select the New VAT Rate at which the prices will be generated.


    • Click on the Based on Rate drop-down menu to select the Previous Rate at which the new prices will be based on.


    • Click on the Generate Prices button.


    • The Effective Date Copy screen will open.


💡Please Note: This screen has been deliberately designed to force you to choose every option yourself.

      • Click on the corresponding radio buttons to select the appropriate options.


        • Do Not Copy GoodX Prices: The GoodX columns of the Pricelists remain at 0.00. The next time a Price Package is pushed from Oddo for this Pricelist Collection, then only will the prices update.
        • Copy to GoodX Prices (with VAT change)*: Copies the Prices with the new VAT change.

💡Please Note: The Copy to GoodX Prices (with VAT change)* option is generally not recommended but is intended to only be used to manually update the prices to the new VAT Rate. 


        • Do Not Copy Local Prices: The prices will not be copied.
        • Copy Local Prices (with VAT Change): Copies the prices with the VAT change.
        • Copy Local Prices (just copy, DO NOT apply VAT change): Copies the prices without the VAT change.


        • Do not Copy: Combinations will not be copied.
        • Copy with VAT Change: Copies the combinations with the VAT change.
        • Copy-no VAT Change: Copies the combinations without the VAT change.


        • Do Not Copy Local RVUs: Will not copy the Local RVUs over.
        • Copy Local RVUs (with VAT changes): Copies the Local RVUs over with the new VAT changes.
        • Copy Local RVUS (DO NOT apply vat changes): Copies the Local RVUs over without the new VAT changes.
      • Tick the Overload data if it already exists check box if you want to work on the pre-VAT Rate information for the moment to reload it.


    • Click on the OK (F2) button.


      • The Select Collections: Choose screen will open.


  • Tick the Select checkbox to select the collection.


  • Click on the Ok button to generate the Prices based on the options that you have selected.


    • The GoodX Price Update Utility pop-up will appear to advise the Prices have been generated and updated based on your selections.


      • Click on the Ok button to acknowledge the message.


  • If you view a Pricelist now, the Prices have been updated.


  • Click on the Unit Prices button.


  • The Relative Conversion Factors (RCF) for Pricelist 1 screen will open, where you will see the relevant changes have been applied.



Linking the new VAT Rate per Medical Aid.

The system will charge the new VAT Rate price from the date that that has been set as the Effective From date. Unfortunately, not all Medical Aids will be ready for the transition to the new VAT Rates and won't accept the new increased prices due to the VAT Rate increase. However, the Practitioner is still obliged to charge the Patient the new VAT Rate. Therefore we will set the Linking of the Pricelists to the effective  

  • From the GoodX Price Updating Tool screen.


  • Click on the Linking button.


  • Click on the Pricelist Profiles - Set Effective Dates for Pricelist VAT Rates Option. 


  • The Linking screen will open.


  • Click on the appropriate opinion to select it.


  • Click on the Show Linking For Profile button.


  • The Price Linking screen will open.


  • Click on the VAT Rate Effective Date drop-down menu of the Medical Aid Option which Effective Date you want to change, to select the date from the date picker that becomes available.


  • Click on the OK button to save.


💡Please Note: When billing you will be able to see the VAT Rate at which the Medical Aid Option is going to be billed based on the Effective Date that was set, on the Episode screen.



💡Please Note: Billing Dates before the VAT Rate was changed will still be billed at the old rates.



💡Please Note: The difference in billing rates is based on the Service Date.




Effects of the New VAT Rate on the Debtors Transaction Drilldown (Daily Report)

Shows the effects the implementation of the new VAT Rate has on the Daily Report. 

  • Generate a Debtors Transaction Drilldown (Daily Report).


  • The Transaction Date, determines the VAT Rate. 

 

💡Please Note: The VAT Exclusive Amount charged stays the same and is not affected by the VAT Rate change. Only the Total which is VAT-inclusive will change.



Last modified: Wednesday, 2 April 2025, 9:47 AM