VAT (value added tax) is charged on most goods and services provided by VAT-registered businesses in the UK. As with any tax system, the details are complex, and there are penalties for non-compliance. Our aim is to make things as straightforward as possible. We can help you with all aspects of VAT management, including VAT-registration and filing returns.

VAT basics

There are different rates of VAT. The standard rate is 20 per cent and most items fall in this category. For some items a reduced rate of 5 per cent applies (for example, domestic fuel and power), and some are zero-rated (like food or children’s clothes). In addition, certain items are exempt from VAT or fall outside the VAT system entirely.

Once company turnover reaches a certain point, it is a legal requirement to be VAT-registered. It is also possible to voluntarily become VAT-registered. Companies that are VAT-registered not only charge VAT on their own goods or services, but are also able to reclaim VAT paid on their purchases.

VAT-registered companies have to submit a regular VAT return showing the amount of VAT charged (output tax) and the amount that they have paid (input tax). Depending on which is greater, you might pay the difference to HM Revenue & Customs, or might claim the difference back.

We can help you register your business for VAT, complete VAT returns, clarify the law around VAT, and plan your business transactions in tax-effective ways.

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