15% VAT rate – don’t forget to change your rates

Posted by admin on 1 December, 2008 under Business news, Tax advice for businesses | Be the First to Comment

As of 1 December 2008 the new rate of Value Added Tax (VAT) is 15% so do not forget to change the rate you charge on your products.

For those of you with a website do not forget to adjust the rates applied to your online products too, as it could be quite easy to forget.

More profit to the business or lower charge for customers?

There are two ways to alter your Value Added Tax (VAT) rates:

1. You could keep the same sale price of your products, so if for example you originally sold some software for £10 before the change in VAT rate and did not want to change this to an odd price of £9.79, you could instead keep the price at £10 and pocket the extra profit. However, the government is hoping for businesses to do the second option:

2. You can alternatively pass on the VAT rate change to your customers and instead of keep your price at the £10 you change what you charge to £9.79.

The main point of this article though is to make sure that businesses do make the change and alter the VAT rate they charge on invoices within their business and on their online business websites.