VAT Rates and Exemptions

Understanding standard, reduced and zero rates, and which goods and services are VAT exempt.

Reduced VAT Rate for Hospitality and Tourism

The UK government introduced temporary reduced VAT rates for hospitality, hotel accommodation and attractions in response to the COVID-19 pandemic. These reduced rates ended on 31 March 2022, and normal VAT rules now apply. If you operate a business in these sectors, you should charge the standard...

4 min read

VAT Exemption and Partial Exemption Explained

If you sell goods or services that are exempt from VAT, you cannot usually reclaim the VAT you've paid on related business purchases. This becomes more complicated if you make both taxable and exempt supplies—a situation known as partial exemption. Understanding the difference...

7 min read

VAT on Books, Newspapers and Electronic Publications

If you publish, sell, or distribute books, newspapers, magazines, or their electronic equivalents, understanding VAT treatment is essential. Most printed publications and their electronic versions can be zero-rated for VAT, meaning no VAT is charged on the sale. However, there...

5 min read

VAT on Children's Clothing and Footwear

Children's clothing and footwear can be zero-rated for VAT, meaning you charge no VAT on the sale, when specific conditions are met. This applies to items designed for and suitable only for young children, based on strict size limits and other criteria. Understanding these rules correctly is...

5 min read

VAT on Food and Drink

VAT on food and drink can be complicated because the same product may be charged at different rates depending on how and where it's sold. Most food for home consumption is zero-rated, but items sold as catering, hot takeaways, and certain products like crisps and ice cream are...

5 min read

VAT on Fuel and Power

The VAT treatment of fuel and power depends on who is using it and what for. In most cases, domestic and certain charitable users benefit from the reduced rate of VAT (currently 5%), while business users pay the standard rate (20%). Understanding these rules is important whether you're buying...

5 min read

What Are the Different VAT Rates?

When you're VAT-registered, understanding which rate to charge on your sales is essential for staying compliant. In the UK, there are four main VAT categories: standard rate (20%), reduced rate (5%), zero rate (0%), and exempt supplies. The rate you apply depends on what you sell or provide.

4 min read