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Different VAT rates apply to different goods and services.
There are also specific VAT rules that apply to certain trades. You need to be aware of these rules if they apply to your business because they affect how you account for VAT, how much VAT you must pay, and how much VAT you can reclaim.
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If you are a retailer, you don't need to issue a separate VAT invoice for transactions under £250 unless the customer wants one. You can also use one of the VAT retail schemes, which allow you to aggregate your sales and account for VAT on the total.
There are specific VAT rules for retailers and wholesalers of certain goods.
Certain supplies of goods and services to disabled people may be zero-rated.
A wide range of electronic goods are covered by a range of specific VAT legislation.
There are specific rules for motor traders dealing with:
If you sell second-hand goods or antiques you may be able to take advantage of one of the VAT margin schemes.
Some printed material such as books, newspapers, music and maps may qualify for zero-rating.
There are rules for how much VAT you have to charge on philatelic supplies. Certain investment gold coins are exempt from VAT.
There are VAT implications if you rent out films, or if you accept customers' films in part-exchange when you sell them new films.
If you charge customers for delivery it affects the VAT you must charge.
Boats which are exported from the European Union, or which are sailed away from the EU by a non-UK customer can be zero-rated.
You may be able to zero-rate the supply of machine tools used to manufacture goods that will be sent abroad.
Farmers may be able to benefit from the Agricultural Flat Rate Scheme. Also, certain animals and animal food may be zero-rated.
If you process someone else's food products to produce new goods that are zero-rated for VAT, then your services are zero-rated for VAT too. There is also an agreement with the Agriculture and Horticulture Development Board (AHDB) about the VAT treatment of the levies they collect from slaughterhouses.
There is an agreement with the AHDB about the VAT treatment of the levies they collect from exporters of live animals.
There are a number of agreements with the British Horseracing Board and other bodies about VAT registration of racehorse owners and the VAT treatment of various issues regarding racehorses.
There is an agreement with the Brewer's Society that affects how VAT in respect of a tenanted estate is reclaimed.
Freight transported entirely within the UK will usually be standard-rated, but different rules apply to international transport. There are various rules for VAT on the import and export of goods.
You can usually zero-rate domestic passenger transport in any vehicle, ship or aircraft that has at least ten seats. Different rules apply to VAT on international transport.
There are specific VAT rules if you are an owner-driver, or if you run a taxi or minicab business or taxi association.
There is an agreement in place with the British Vehicle Rental and Leasing Association that deals with how VAT should be calculated on the private use of hire cars.
Construction of buildings can be zero-rated or standard-rated, depending on the property itself and the circumstances. Sales of land and property may be exempt, zero-rated or standard-rated, depending on the exact circumstances.
Some building work or materials can be zero-rated or reduced-rated. However, there are rules about what VAT property developers can reclaim, and about when they have to account for VAT on building projects.
Normally, property rental is exempt from VAT. However, landlords may be able to waive this exemption and opt to tax a property. Doing so enables the landlord to reclaim VAT on certain expenditure related to that property.
Supplies of water or sewerage services made by a landlord may be either zero-rated or standard-rated, depending on the circumstances. Supplies of fuel and power are normally standard-rated but in some circumstances may qualify for the reduced rate.
Special VAT rules apply to barristers and advocates, especially regarding the input tax charged on shared premises, office equipment and services when barristers or advocates share chambers.
If you supply staff, then whether or not the staff are under your direction or control can make a difference to the VAT treatment of the supply.
Insurance transactions are exempt from VAT, but some premiums may be liable to Insurance Premium Tax.
Clubs and associations need to know the rules that apply to VAT on membership subscriptions, prize and appearance money, and other aspects of their business.
Some supplies made by youth clubs and some supplies relating to certain sports may be exempt from VAT.
There are specific rules about how you account for the VAT on supplies relating to coin-operated gaming and amusement machines.
The charges relating to bingo games and participation in lotteries are exempt from VAT.
Sleeping accommodation may be exempt from VAT if a guest stays for over 28 consecutive days.
There are specific rules about VAT on the provision of services to caravans and houseboats.
If you buy in and resell travel facilities you may have to use the Tour Operator's Margin Scheme.
Supplies of food and drink in the course of catering, including supplies of hot takeaway food are standard-rated.Supplies of cold food and drink for takeaway may be zero-rated providing that the product is not standard-rated in its' own right.
Admission to certain cultural events is exempt from VAT.
A travel agent can have three different kinds of relationship with their customers, and this affects how they account for VAT.
Charities may need to register for VAT, but may benefit from special VAT treatment.
Some of the services provided by health professionals and qualifying
health institutions may be exempt from VAT.
Certain health bodies, research institutions or charitable institutions may be able to purchase, or receive donations of, equipment for medical or veterinary uses without paying VAT.
Most services provided by schools and other educational establishments are exempt from VAT, but there are exceptions.
Welfare services and connected goods provided by charities, welfare agencies or institutions, or public bodies, may be exempt from VAT.
Some of the services associated with funerals, burials and cremations may be exempt from VAT.