Rates of VAT

There are different VAT rates, depending on the goods or services that are being provided. At the moment there are three rates:

  • Standard rate - 20 per cent
  • Reduced rate - 5 per cent
  • Zero rate - 0 per cent

The standard rate of VAT is the default rate - this is the rate that's charged on most goods and services in the UK unless they're specifically identified as being reduced or zero-rated.

Examples of reduced-rated items

These are some examples of goods and services that may be reduced-rated, depending on the product itself and the circumstances of the sale:

  • Domestic fuel and power
  • Installing energy-saving materials
  • Sanitary hygiene products
  • Children's car seats

This isn't a complete list of reduced-rated items and services.

Examples of zero-rated items

These are examples of goods and services that may be zero-rated, depending on the product itself and the circumstances of the sale:

  • Food - but not meals in restaurants or hot takeaways
  • Books and newspapers
  • Children's clothes and shoes
  • Public transport

This isn't a full list of zero-rated items.

We offer a range of solutions tailored to the tax needs of small business and companies. Contact us online using our online tax enquiry form or alternatively call us today.