Value Added Tax Articles

Overseas seller VAT check

Since 2018, online marketplaces (such as eBay or Amazon) have been required to help tackle online VAT fraud. These measures, known as joint and several liability (JSL) for marketplaces aim to ensure that all businesses selling goods in the UK follow the same rules and pay the correct amount of VAT. Legislation allows HMRC to hold the operator of an online marketplace jointly and severally liable...

VAT Flat Rate Scheme

The VAT Flat Rate Scheme (FRS) has been designed to simplify the way a business accounts for VAT and in so doing reduce the administration costs of complying with the VAT legislation. The scheme is open to businesses that expect their annual taxable turnover in the next 12 months to be no more than £150,000. The limited cost trader test was introduced in April 2017 to help tackle abuse or...

VAT and food supplies

HMRC’s VAT Notice 701/14: food explains what types of foods are zero rated and standard rated for VAT. The notice includes many examples of different food categories. The notice covers some general VAT liability rules. For example, food supplied in the course of catering is standard rated for VAT. This includes hot take-away food. Most basic food stuffs intended for human consumption and not...

Construction services taxed at VAT zero or 5% rate

Whilst most businesses in the UK charge VAT at the standard rate of 20%, there are a number of different VAT rates and exemptions that businesses should be aware of.

Furnished Holiday Lets and VAT

The furnished holiday let (FHL) rules allow holiday lettings of properties that meet certain conditions to be treated as a trade for some specific tax purposes.

VAT Flat Rate Scheme – are you a limited cost trader?

The VAT Flat Rate Scheme has been designed to simplify the way a business accounts for VAT and in so doing reduce the administration costs of complying with the VAT legislation.

VAT – discounts and free gifts

There are special rules when charging VAT where there are discounts or free gifts. The rules are complex, but we have summarised the main aspects below.

Builders – when you may not have to charge VAT

VAT for most work on houses and flats by builders and similar trades is charged at the standard rate of 20%, but there are exceptions…

Reclaiming VAT

For most fully taxable businesses, VAT can be reclaimed on goods and services used in the course and furtherance of their business activities.

Definition of VAT partial exemption

A business that incurs expenditure on taxable and exempt business activities is partially exempt for VAT purposes. This means that the business is required to make an apportionment between the activities using a ‘partial exemption method’ in order to

Revoking VAT option to tax land and buildings

There are special VAT rules that allow businesses to standard rate the supply of most non-residential and commercial land and buildings (known as the option to tax).

Range of supplies affected by VAT reverse charge

The VAT domestic reverse charge accounting mechanism was put in place to help prevent criminal attacks on the UK VAT system by means of sophisticated fraud.

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