Vat

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Miss Dazy
Miss Dazy Registered Posts: 34 Regular contributor ⭐
in AAT Level 3 (Level 6 in Scotland)
what would be the main effect of beginning to sell items exempt from VAT as a business? having previously only old items that are standard rated?

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  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    If the exempt sales are less than 25% of the turnover, no change (other than you don't owe any VAT to HMRC on them nor collect any from customers.

    However, if they are more than that, then you get into the realms of complicated Partial Exemption caluclations which mean you can't claim back all the input VAT.

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