Small businesses with turnover below £150,000 may join the VAT flat rate scheme which makes their VAT accounting much simpler as they merely pay HMRC a percentage of their VAT inclusive turnover.
The temporary reduction in the rate of VAT from 20% to 5% reduces the flat rate percentages for affected businesses as set out below:
|Type of Business||15 July 20 to 12 Jan 2021||From 13 January 2021|
|Catering services including restaurants and takeaways||4.5||12.5|
|Hotel or accommodation||0||10.5|
Note that to use the flat rate percentage for pubs the turnover must be predominantly “wet sales”.
Need more information?
Do you need help with the VAT flat rate scheme? We offer a wide range of services to help! Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.
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