#vat

#vat

VAT on the fixed part of households' electricity and gas bills will increase from 5.5 percent to 20 percent on August 1st, in line with an EU directive.

Removing VAT on repaired electronics should be part of a wider push to cut waste, extend the life of products and develop a truly circular economy. Currently, refurbished electronics sold in the UK are subject to the same VAT rate as new goods, which discourages their purchase vs. new electrical products.

"If the bread is sweetened and designed to be eaten with fingers, the case for classifying it as confectionery is surprisingly strong," said Simon Knivett, VAT manager at HW Fisher.

The Government's VAT take on energy bills has surged despite a temporary cut in the rate on residential electricity and gas accounts, highlighting the impact of spiking costs.

VAT compliance is both complex and essential for SMEs, posing challenges in regulation navigation, record-keeping, and penalties, calling for professional VAT accountants.

The increase in VAT was good news. This reflects continued strong levels of employment and the fact that consumers are continuing to spend.

"VAT is a widely adopted indirect tax that significantly contributes to government revenue by being levied on goods and services at each stage of production and sale."

HMRC's total receipts across the busy period of December to February were £11bn higher in 2024/25 than 2023/24.