VAT Margin Schemes
The VAT Margin Scheme operates a reduced rate of 16.67% that applies to the NET difference between the purchase and sales of your goods. This differs from standard VAT reporting that applies to the difference between your input and output tax.
You can choose to use the margin scheme when you sell:
- second-hand goods
- works of art
- collectors items
You will not be able to use the margin scheme for:
- any item you bought for which you were charged VAT
- precious metals
- investment gold
- precious stones
How can I register for a VAT Margin Scheme?
There is no formal registration process, you can start using a margin scheme at any time by retaining the correct records, and then reporting this on your VAT return.
If you would like to register your business for VAT you can start an application here.
There are specific rules if youre engaged in the sale of:
- second hand vehicles
- horses and ponies
- houseboats and caravans
- high volume, low price items - you can use the Global Accounting Scheme, a simplified version of the margin scheme
There are also special rules for pawnbrokers and auctioneers. --Latest--