What criteria businesses do need to meet to be levied at 5 percent VAT?

What criteria businesses do need to meet to be levied at 5 percent VAT? To qualify for VAT exemption the site has to be either:

• For domestic use
• A building, or part of a building, which consists of a dwelling or number of dwellings
• A building, or part of a building, used for a residential purpose
• A home or other institution providing residential accommodation for children
• A home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present medical disorder
• A hospice
• A residential accommodation for students or school pupils
• Residential accommodation for members of any of the armed forces
• A monastery, nunnery or similar establishment
• An institution which is the sole or main residence of at least 90% of its residents
• Except use as a hospital, a prison or similar institution, a hotel, inn or similar establishment
• Self catering holiday accommodation
• A caravan
• A houseboat
• A charity otherwise than in the course of furtherance of a business
• Where there is a supply of goods or services partly for domestic or charitable endeavours
• If at least 60% of the goods or services qualify (meet the aforementioned criteria the whole shall be treated as meeting the criteria)

There are two more common types of contracts for businesses, 28 day rolling contracts and the Deemed Rates contracts VAT rates There are 3 different rates of VAT and you must make sure you charge the right amount. Get a list of reduced or zero-rated goods and services. Standard rate Most goods and services are standard rate. You should charge this rate unless the goods or services are classed as reduced or zero-rated. This includes any goods below the distance selling threshold you supply from Northern Ireland to non-VAT registered EU customers. If you go over the threshold, you’ll have to register for VAT in that country. Reduced rate When you charge this rate can depend on what the item is as well as the circumstances of the sale, for example:

• Children’s car seats and domestic fuel or power are always charged at 5%
• Mobility aids for older people are only charged at 5% if they’re for someone over 60 and the goods are installed in their home

Zero rate Zero-rated means that the goods are still VAT-taxable but the rate of VAT you must charge your customers is 0%. You still have to record them in your VAT accounts and report them on your VAT Return. Examples include:

• Books and newspapers
• Children’s clothes and shoes
• Motorcycle helmets
• Most goods you export from England, Wales and Scotland (Great Britain) to a country outside the UK
• Most goods you export from Northern Ireland to a country outside the EU and the UK
• Goods you supply from Northern Ireland to a VAT registered EU business – you can check if the VAT number is valid
• If you sent goods to the EU from Northern Ireland, you’ll need their VAT number and paperwork proving that the goods have been sent within certain time limits (usually 3 months).
• Businesses and charging VAT: VAT rates – GOV.UK (www.gov.uk)

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