What flat rate VAT percentage do I apply for multiple business sectors?

The flat rate VAT rates you apply depend on your primary business activity, with HMRC setting specific percentages for different sectors ranging from 4% to 14.5%. If you operate across multiple business sectors, you must use the rate for your main business activity, determined by your highest turnover stream over the previous 12 months.

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What flat rate VAT percentage do I apply for multiple business sectors?

If your business can be classified under more than one sector because you provide different types of services or products, you’ll then use the percentage that applies to the majority of your services or sales, and apply that to your total sales.

Let’s say you’re running a hair salon-cum-restaurant business. If 70% of your sales is derived from providing hair and beauty treatments, you’ll then apply a VAT flat rate of 13% (for hairdressing and beauty treatment services) to your total turnover.



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