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VAT On Multi-products

Most products and services are subject to standard rate VAT at 20%, but some products are zero-rated (VAT applied at 0%), while others, e.g. rent for certain buildings, are exempt from VAT. There is a limited range of products and services that attract 5% VAT.

If you supply a package which is made up of products and services which carry different rates of VAT,you need to be sure of the split to charge the right amount of VAT to your customers. HMRC may insist that you charge VAT at the highest rate if he thinks the lower-rated product is only incidental to the total package the customer is buying. For example a printed leaflet (zero rate) sold with a DVD (standard rate).

If your products have several elements with different VAT treatments, talk to us about how your customers view the mix, and how you should split the VAT charges.

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Added By: Luke Noble on 02nd Sep 2014 - 14:48
Number of Views: 1228
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