How VAT works, free calculator

How VAT works

You can only charge VAT if your business is registered for VAT. VAT is charged on matters like: commercial enterprise sales - for example when you sell goods and services hiring or loaning items to someone promoting enterprise assets commission items bought to staff - as an instance canteen meals commercial enterprise goods used for private reasons ‘non-sales’ like bartering, part-trade and gifts.

These are recognised as ‘taxable supplies’.

There are different rules for charities. Responsibilities VAT-registered businesses: should price VAT on their goods or services may additionally reclaim any VAT they’ve paid on commercial enterprise-related items or services If you’re a VAT-registered commercial enterprise you ought to document to HM Revenue and Customs (HMRC) the amount of VAT you’ve charged and the quantity of VAT you’ve paid. This is done through your VAT Return which is normally due each three months.

You may want to rent an agent to address HMRC on your behalf. You should account for VAT on the full value of what you promote, even in case you: acquire items or services rather than money (for instance in case you take something in part-trade) haven’t charged any VAT to the customer - whatever fee you fee is treated as which include VAT If you’ve charged extra VAT than you’ve paid, you have to pay the difference to HMRC. If you’ve paid more VAT than you’ve charged, you could reclaim the difference from HMRC.

I could not find a VAT calculator on the gov.uk website, therefore have linked to another here: https://calculators.icu/online-vat-calculator

The VAT Registration Threshold

The UK’s £85,000 VAT registration threshold is the highest threshold in both the EU,4 where the average is £20,000, and the highest general threshold in the OECD.5 The UK’s high threshold is often itself seen as a tax simplification measure, as most businesses can operate without needing to be registered for VAT – for example many largely labour-based business owners are content to operate on the basis of a turnover below the threshold.