VAT is an acronym for Value Added Tax and was introduced in the UK in 1973. It is a tax that is applied to the purchase price of certain goods, services and other taxable supplies that are bought and sold within the UK.
There are 3 rates of VAT chargeable in the UK and each rate depends on the goods or services being provided.
Standard – 20% – Most goods and services
Reduced 5% – Some good and services such as home energy, children’s care seats and restaurants and takeaways soft drinks and food until September 2021.
Zero – Most food and children’s clothing