UK VAT Flat Rate Changes January 2010
The Standard rate of VAT changed back to 17.5% with effect from Friday 1 January 2010.
Changes to the flat rate scheme percentages
Alongside the changes to the Standard rate, the flat rate percentages for many trade sectors change and for some sectors they are not the same rates as they were using up to 30 November 2008.
If your VAT return period does not end on 31 December 2009, you will have to work out your gross sales for pre and post 1 January and apply the appropriate flat rate percentage to each.
How to work out your VAT if the rates change during your VAT quarter
For example, for a business with £10,000 net sales per month, a VAT quarter ended 31 January 2010 and in the advertising sector, the flat rate VAT would be as follows:
Gross sales for 2 months ended 31 December 2009 (2 x £10,000 x 115.0%) = £23,000
Flat rate VAT for 2 months ended 31 December 2009 (£23,000 x 8.5%) = £1,955.00
Gross sales for month ended 31 January 2010 (£10,000 x 117.5%) = £11,750
Flat rate VAT for month ended 31 January 2010 (£11,500 x 10%) = £1,150.00
So in the VAT Return for quarter ended 31 January 2010:
Box 1 (VAT Due) is £1,955.00 + £1,150.00 = £3,105.00
and Box 6 (Sales) is £23,000 + £11,750 = £3,750
HRBS can help you with your flat rate VAT accounting
At HRBS we have many clients on the flat rate VAT scheme and can help you set up your accounting system to make the flat rate VAT return a breeze to complete.
Call Keith on 01226 379000 for a free, no obligation chat about your business and how we can help you, or send us an email with information about your business so that we can provide you with a fixed fee quotation.
To help you we have listed the old and new flat rate VAT percentages below
| Flat rate percentage | ||
| Trade sector | To 31 Dec 2009 | From 1 Jan 2010 |
| Accountancy or book-keeping | 11.5% | 13.0% |
| Advertising | 8.5% | 10.0% |
| Agricultural services | 7.0% | 10.0% |
| Any other activity not listed elsewhere | 9.0% | 10.5% |
| Architect, civil and structural engineer or surveyor | 11.0% | 13.0% |
| Boarding or care of animals | 9.5% | 10.5% |
| Business services that are not listed elsewhere | 9.5% | 10.5% |
| Catering services, including restaurants and takeaways | 10.5% | 11.0% |
| Computer and IT consultancy or data processing | 11.5% | 13.0% |
| Computer repair services | 10.0% | 9.5% |
| Dealing in waste or scrap | 8.5% | 9.5% |
| Entertainment or journalism | 9.5% | 11.0% |
| Estate agency or property management services | 9.5% | 10.5% |
| Farming or agriculture that is not listed elsewhere | 5.5% | 6.0% |
| Film, radio, television or video production | 9.5% | 11.5% |
| Financial services | 10.5% | 12.0% |
| Forestry or fishing | 8.0% | 9.5% |
| General building or construction services | 7.5% | 8.5% |
| Hairdressing or other beauty treatment services | 10.5% | 11.5% |
| Hiring or renting goods | 7.5% | 8.5% |
| Hotel or accommodation | 8.5% | 9.5% |
| Investigation or security | 9.0% | 10.5% |
| Labour-only building or construction services (See Note) | 11.5% | 13.0% |
| Laundry or dry-cleaning services | 9.5% | 10.5% |
| Lawyer or legal services | 12.0% | 13.0% |
| Library, archive, museum or other cultural activity | 7.5% | 8.5% |
| Management consultancy | 11.0% | 12.5% |
| Manufacturing food | 7.0% | 8.0% |
| Manufacturing that is not listed elsewhere | 7.5% | 8.5% |
| Manufacturing yarn, textiles or clothing | 7.5% | 8.0% |
| Manufacturing fabricated metal products | 8.5% | 9.5% |
| Membership organisation | 5.5% | 7.0% |
| Mining or quarrying | 8.0% | 9.0% |
| Packaging | 7.5% | 8.0% |
| Photography | 8.5% | 10.0% |
| Post Offices | 2.0% | 4.5% |
| Printing | 6.5% | 7.5% |
| Pubs | 5.5% | 6.0% |
| Publishing | 8.5% | 10.0% |
| Real estate activity not listed elsewhere | 11.0% | 12.5% |
| Repairing personal or household goods | 7.5% | 9.0% |
| Repairing vehicles | 6.5% | 7.5% |
| Retailing food, confectionery, tobacco, newspapers or children’s clothing | 2.0% | 3.5% |
| Retailing pharmaceuticals, medical goods, cosmetics or toiletries | 6.0% | 7.0% |
| Retailing vehicles or fuel | 5.5% | 6.0% |
| Retailing that is not listed elsewhere | 5.5% | 6.5% |
| Secretarial services | 9.5% | 11.5% |
| Social work | 8.0% | 10.0% |
| Sport or recreation | 6.0% | 7.5% |
| Transport or storage, including couriers, freight, removals and taxis | 8.0% | 9.0% |
| Travel agency | 8.0% | 9.5% |
| Veterinary medicine | 8.0% | 10.0% |
| Wholesaling agricultural products | 5.5% | 7.0% |
| Wholesaling food | 5.0% | 6.5% |
| Wholesaling that is not listed elsewhere | 6.0% | 7.5% |
Note: “Labour-only building or construction services” means building or construction services where the value of materials supplied is less than 10 per cent of relevant turnover from such services; any other building or construction services are “general building or construction services”.
