Beginner’s Guide to UK VAT: Registration, Rates, Exemptions, and Record-Keeping Explained

• VAT in the UK applies to goods and services at rates of 20% (standard), 5% (reduced), and 0% (zero-rated), with some supplies exempt.
• Businesses must register for VAT if taxable turnover exceeds £90,000 in 12 months, if acquiring a VAT-registered business, or if purchasing VAT-free goods/services from abroad.
• Exempt supplies (e.g., certain financial, property, insurance, education, and healthcare services) do not count toward taxable turnover and cannot reclaim all input tax.
• VAT-registered businesses must keep accurate records for at least six years and use MTD-compliant software for VAT returns.
• Simplified VAT schemes exist for small businesses, and VAT payable to or reclaimable from HMRC is calculated as output tax minus input tax.

Source: fiscal-requirements.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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