Value added tax

  From 1 April 2014 From 1 April 2013
Standard rate 20% 20%
Standard rate VAT fraction 1/6 1/6
Reduced rate 5% 5%
Reduced rate VAT fraction 1/21 1/21
Zero rate  0% 0%
Taxable turnover limits
Registration - last 12 months or next 30 days over £81,000 £79,000
Deregistration - next 12 months under £79,000 £77,000
Cash accounting scheme - up to £1,350,000 £1,350,000
Optional flat rate scheme    
 - joining up to £150,000 £150,000
- exiting over £230,000  £230,000*
Annual accounting scheme - up to £1,350,000 £1,350,000

* A business must leave the scheme when turnover increases to £230,000. However, a business can remain in the scheme with HMRC's written agreement provided it can be shown that total sales in the following 12 months will be less than £191,500 including VAT.

It is expected that the standard rate of VAT will remain at 20% until at least after the 2015 General Election.

Cars and your VAT return

VAT scale figures for private use are based on carbon emissions. Please refer here for the scale figures for VAT returns.