VAT retail schemes
Apportionment Scheme
Who can use it
You can only use this scheme if you buy goods for resale.
You can鈥檛 use apportionment if you provide:
- services
- goods that you鈥檝e made or grown yourself
- catering services
Your turnover, excluding VAT, can鈥檛 be more than 拢1 million a year.
There is a separate scheme for businesses with a turnover of between 拢1 and 拢130 million.
How to calculate your VAT
-
Calculate the total value of goods purchased for resale in the VAT period for each VAT rate.
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Divide the total of purchases for each VAT rate by the total for all purchases.
-
Multiply the outcome by your total sales, divided by 6 for 20% rated goods, and divided by 21 for 5% rated goods.
Example
In the VAT period you buy goods at the following VAT rates:
- 拢16,000 of goods at 20%
- 拢1,000 at 5%
- 拢10,000 at zero rate
Total purchases: 拢27,000
Your total sales are 拢34,000.
(拢16,000 / 拢27,000) x 拢34,000 / 6 = 拢3,358.02
(拢1,000 / 拢27,000) x 拢34,000 / 21 = 拢59.96
Total VAT for the period = 拢3,417.98