Value Added Tax VAT 2024
Published / Last Updated on 06/04/2023
Value Added Tax VAT Tax Year 2024
(06/04/2024 to 05/04/2025)
Standard Rate
- Rates of Value Added Tax Standard Rate = 20.00 %
Reduced Rate
- Fuel And Power For Domestic Use = 5%
- Installation Of Energy Saving Materials = 0% (Reduced from 5% 01/04/2022)
- Security Improvement For Pensioners = 5%
Registration And De-Registration Limits
- Registration Threshold = £90,000.00
- De-Registration Threshold = £88,000.00
1. Value Added Tax - VAT Flat Rate Scheme For Smaller Businesses
This is only an option for smaller businesses who may wish to simplify their calculations and returns.
A business that has a tax exclusive annual turnover of up to £150,000 can elect to use this option.
A business that has a tax exclusive annual turnover (including exempt and other non-taxable income) below £230,000 can elect to use this option.
What is the option?
This scheme was introduced on 25 April 2002 and works on the principle that rather than carrying out complex calculations of various input, output, exempt and other rates for each transaction, the small business can simply apply a flat percentage rate to their tax inclusive turnover.
How is it worked out?
Example: To calculate your turnover, you can record supplies at the time you invoice your customers or at the time you receive payment.
At the end of each VAT period you take the VAT inclusive turnover of your business and multiply this by the flat rate percentage for your trade sector. For example, if your business is the repair of motor vehicles and your VAT inclusive turnover for the VAT period is £20,000 the calculation is:
£20,000 x 8.5%= £1,700.
The tax due is £1,700.
Table of flat rates applicable to various business types:
|
Business Type |
VAT percentage % payable |
|
Accountancy or book-keeping |
14.5 |
|
Advertising |
11 |
|
Agricultural services |
11 |
|
Any other activity not listed elsewhere |
12 |
|
Architect, civil and structural engineer or surveyor |
14.5 |
|
Boarding or care of animals |
12 |
|
Business services that are not listed elsewhere |
12 |
|
Catering services including restaurants and takeaways |
12.5 |
|
Computer and IT consultancy or data processing |
14.5 |
|
Computer repair services |
10.5 |
|
Dealing in waste or scrap |
10.5 |
|
Entertainment or journalism |
12.5 |
|
Estate agency or property management services |
12 |
|
Farming or agriculture that is not listed elsewhere |
6.5 |
|
Film, radio, television or video production |
13 |
|
Financial services |
13.5 |
|
Forestry or fishing |
10.5 |
|
General building or construction services* |
9.5 |
|
Hairdressing or other beauty treatment services |
13 |
|
Hiring or renting goods |
9.5 |
|
Hotel or accommodation |
10.5 |
|
Investigation or security |
12 |
|
Labour-only building or construction services* |
14.5 |
|
Laundry or dry-cleaning services |
12 |
|
Lawyer or legal services |
14.5 |
|
Library, archive, museum or other cultural activity |
9.5 |
|
Management consultancy |
14 |
|
Manufacturing fabricated metal products |
10.5 |
|
Manufacturing food |
9 |
|
Manufacturing that is not listed elsewhere |
9.5 |
|
Manufacturing yarn, textiles or clothing |
9 |
|
Membership organisation |
8 |
|
Mining or quarrying |
10 |
|
Packaging |
9 |
|
Photography |
11 |
|
Post offices |
5 |
|
Printing |
8.5 |
|
Publishing |
11 |
|
Pubs |
6.5 |
|
Real estate activity not listed elsewhere |
14 |
|
Repairing personal or household goods |
10 |
|
Repairing vehicles |
8.5 |
|
Retailing food, confectionary, tobacco, newspapers or children's clothing |
4 |
|
Retailing pharmaceuticals, medical goods, cosmetics or toiletries |
8 |
|
Retailing that is not listed elsewhere |
7.5 |
|
Retailing vehicles or fuel |
6.5 |
|
Secretarial services |
13 |
|
Social work |
11 |
|
Sport or recreation |
8.5 |
|
Transport or storage, including couriers, freight, removals and taxis |
10 |
|
Travel agency |
10.5 |
|
Veterinary medicine |
11 |
|
Wholesaling agricultural products |
8 |
|
Wholesaling food |
7.5 |
|
Wholesaling that is not listed elsewhere |
8.5 |
* 'Labour-only building or construction services' means building or construction services where the value of materials supplied is less than 10 per cent of relevant turnover from such services. Any other building or construction services will fall into the 'General building and construction services' trade sector.
2. Value Added Tax VAT - Small Business Annual Accounting Scheme
It allows for smaller businesses to elect to make one annual VAT return instead of the usual four.
Maximum Turnover Limit:
The turnover limit for joining the scheme is turnover up to £1,350,000
Moving to VAT Quarterly Returns:
The turnover limit for leaving the scheme is turnover in excess of £1,600,000