Introduction to VAT

Rates of VAT

There are different VAT rates, depending on the goods or services that are being provided. Currently there are three rates:

  • standard rate - 20 per cent
  • reduced rate - 5 per cent
  • zero rate - 0 per cent

The standard rate of VAT is the default rate - this is the rate that's charged on most goods and services in the UK unless they're specifically identified as being reduced or zero-rated.

Examples of reduced-rated items

These are some examples of goods and services that may be reduced-rated, depending on the product itself and the circumstances of the sale:

  • domestic fuel and power
  • installing energy-saving materials
  • sanitary hygiene products
  • children's car seats

This isn't a complete list of reduced-rated items and services.

Examples of zero-rated items

These are examples of goods and services that may be zero-rated, depending on the product itself and the circumstances of the sale:

  • food - but not meals in restaurants or hot takeaways
  • books and newspapers
  • children's clothes and shoes
  • public transport

This isn't a full list of zero-rated items.

You can read an explanation of different VAT rates and find out what rates apply to different goods and services in our related guides below.

VAT rates explained: standard, reduced, zero, exempt

Goods and services where you have to charge VAT

Subjects covered in this guide


Developed with:
HM Revenue & Customs

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