Value Added Tax (VAT) is the UK's consumption tax. The standard rate is 20%, with reduced rates of 5% and 0% for certain goods and services.
| Rate | Rate % | Applies To |
|---|---|---|
| Standard | 20% | Most goods and services not in other categories |
| Reduced | 5% | Home energy, children's car seats, smoking cessation products, some renovations |
| Zero | 0% | Most food (not restaurant), children's clothing, books and newspapers, most medical supplies, public transport |
| Exempt | N/A | Insurance, financial services, education, healthcare, postal services |
Property taxes, state income taxes, and deductions affect your federal return. Get clear, plain-English tax briefs from CapitalTaxBrief.com.