Reduced Rate Update

Some EU member states, including the UK, have a zero rate which was agreed as part of their EU Accession Treaty. For example, in the UK most 'basic' food stuffs are zero rated. However, the UK is no longer able to add to the zero rate categories, and the minimum VAT rate that can be applied to any new category that the Government seeks to reduce rate is 5%.

The 5% VAT reduced rate applies to the provision of the following goods and services:
1. Electricity
2. Children's car seats, booster seats and booster cushions
3. Smoking cessation products
4. Sanitary protection products
5. Mobility aids for the elderly (installation)
6. Renovation / Alteration of certain, empty residential buildings
7. Converting certain premises into different living accommodation
8. Energy saving materials

If you are unsure if a supply you are about to make should or should not be made at the reduced rate of 5% please contact us for clarification.

Disclaimer – Please note: The ideas shared with you in this article are intended to inform rather than advise. Taxpayers’ circumstances do vary and if you feel that tax strategies we have outlined may be beneficial it is important that you contact us before implementation. If you do or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

If you like this article and would like our FREE updates sent straight to your inbox then subscribe to our monthly newsletter


Get in touch

To find out more about how we can help you or your business, call us on 0808 144 5575 and speak to a member of our team. Alternatively use our contact form to send us a message or arrange a callback.

CALL 0808 144 5575


Contact Us

All content © 2015 Armstrong Watson. All Rights Reserved. Website by Simon Pighills.

Armstrong Watson LLP is a limited liability partnership registered in England and Wales, number OC415608. The registered office is 15 Victoria Place, Carlisle, CA1 1EW where a list of members is kept. Armstrong Watson Accountants, Business & Financial Advisers is a trading style of Armstrong Watson LLP. Armstrong Watson LLP is regulated by the Institute of Chartered Accountants in England and Wales for a range of investment business activities.

Armstrong Watson Audit Limited is registered to carry on audit work in the UK and Ireland by the Institute of Chartered Accountants in England and Wales. Registered as a limited company in England and Wales No. 8800970. Registered office: 15 Victoria Place, Carlisle, CA1 1EW

Armstrong Watson Financial Planning Limited is authorised and regulated by the Financial Conduct Authority. Firm reference number 542122. Registered as a limited company in England and Wales No. 7208672. Armstrong Watson Financial Planning & Wealth Management is a trading name of Armstrong Watson Financial Planning Limited. Registered Office: 15 Victoria Place, Carlisle, CA1 1EW