The Increase In The Standard Rate Of VAT To 20% – How It Will Affect Your Pegasus System

The standard rate of VAT is currently 17.5% but will be increased to 20% on Tuesday 4th January 2011. For any sales of standard-rated goods or services that you make on or after Tuesday 4th January 2011 you must charge VAT at the 20% rate. If you have a cash business and calculate your VAT using the VAT fraction you must use the VAT fraction of 1/6 on your standard-rated VAT inclusive sales from 4 January 2011.

The change only applies to the standard VAT rate. There are no changes to sales that are zero-rated or reduced-rated for VAT. Similarly, there are no changes to the VAT exemptions. Any sales you make at these rates are unaffected by this change.

For more information on how this will affect you click here

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