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Value Added Tax (VAT) is the tax you must pay when you buy goods or services. If you are a business, you may be required to register for, and collect VAT.

Businesses with a turnover of more than £85,000 must register to pay and charge VAT on the products and services they buy and sell. Other businesses can choose to register for VAT voluntarily. Businesses charge their customers VAT, but must then pay this to HMRC when they file their quarterly VAT return.

• 20% on goods and services
• 5% is applied to some health, energy, heating, and protective products and services
• 0% is applied to a range of products and services to do with health, building, publishing, and children’s clothing

Company VAT numbers are given only to VAT-registered businesses and can be found on your business’ VAT registration certificate. This important piece of paperwork will also outline when your first VAT return is due and the date from which your company went over the VAT registration threshold and therefore became required to register.