Calculate your VAT payments under the Flat Rate Scheme instantly. Select your business type and see your VAT liability at a glance.
CALCULATOR DETAILS
Calculation Summary
VAT to Pay
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To HMRC
Amount You Keep
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Retained Income
The VAT Flat Rate Scheme is a simplified method for calculating VAT designed specifically for small businesses with turnover under £150,000. Instead of calculating VAT on individual purchases and claiming back input VAT, eligible businesses pay a fixed percentage of their turnover directly to HMRC. This percentage varies by business type, ranging from 4% for retail food businesses to 14.5% for professional services like accountancy and IT.
The VAT Flat Rate Scheme is available to registered VAT businesses with annual turnover below £150,000. You must:
Once you exceed £230,000 turnover, you must leave the scheme.
| Business Type | Flat Rate % |
|---|---|
| Accountancy | 14.5% |
| Advertising | 11% |
| Architect | 14.5% |
| Retail Food | 4% |
| Farming | 6.5% |
| Printing | 8.5% |
| General Building | 9.5% |
| IT Consultancy | 14.5% |
| Legal Services | 14.5% |
| Hotel / Accommodation | 10.5% |
The VAT Flat Rate Scheme is a simplified way to calculate VAT for small businesses with turnover under £150,000. Instead of calculating VAT on individual transactions, you pay a fixed percentage of your turnover to HMRC. The percentage varies by business type from 4% (retail food) to 14.5% (accountancy, IT, legal).
Yes! New businesses can join the flat rate scheme immediately upon VAT registration, provided your turnover is below £150,000. In fact, if you're in your first year of registration, you can apply for a 2% discount on your flat rate percentage, which can make the scheme even more attractive.
You must leave the flat rate scheme if your turnover exceeds £230,000. The scheme is designed for small businesses, and at this level, standard VAT accounting is more appropriate. However, you can voluntarily leave the scheme at any time if standard rating becomes more beneficial.
No, you cannot reclaim input VAT on most supplies while using the flat rate scheme. This is one of the key differences from standard VAT accounting. However, you can still reclaim VAT on capital purchases above £2,000 (or £500 if purchased before 1 April 2022). Any VAT you pay on supplies becomes a business cost.
There are 44+ business categories covered by the flat rate scheme, including everything from accountancy to waste management. If your business type doesn't have a specific rate listed, there's usually a catch-all category like "Other" that applies. Use our calculator above to find your exact rate, or contact HMRC for clarification.