The bulk of the controversy surrounding VAT comes from its weighted system, which separates goods and services into three distinct categories: taxable (standard rated at 20 per cent, reduced rated at five per cent, and zero rated at zero per cent), exempt, and outside the scope (meaning that businesses can pay no VAT at all). However, the distinctions are often unclear and with more exceptions than rules, it’s little wonder that many business owners get tangled in red tape.
Source: lincolnshireworld.com
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