jason mccarthy Posts: 1, Reputation: 1 New Member #1 Aug 25, 2014, 04:45 AM
Calculating commission on a property sale
I am an estate agent in South Africa and have just made my first property sale at R2.3m (gross sale value). The commission on this sale is 7% plus VAT (value added tax). When working out this commission VAT needs consideration as the franchise I work for is VAtakes 50% of the comm and they are VAT registered. The head office takes a royalty of 6.5% of the comm. Is this calc correct below:

R2, 300 000.00 multiplied by 7% = R161 000.00(total comm)
R161 000.00 multiplied by 14 divided by 114 = R19 771.92 (VAT at 14%)
Therefore R161 000.00 less R19 771.92= R141 228.08
R141 228.28 multiplied by 6.5% = R9 179.82 (royalty to head office)
Therefore R141 228.08 less R9 179.83 = R132 048.25
R132 048.25 multiplied by 50% = R66 024.12
Therefore R66 024.12 is payable to me and R66 024.12 payable to franchise
Am I correct in assuming personal tax will still be deducted by Inland Revenue Services on the R66 024.12 payable to me?

Is this correct or not?

Thank you!

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