Is postage VAT exempt or zero rated?

Postage stamps are exempt from VAT. The exemption only relates to services supplied by the Post Office for the conveyance of postal packages. Charges for postage and packing made by suppliers are subject to VAT and that tax can be reclaimed where the goods are used for business purposes.

Is postage zero rated or exempt?

When you buy postage stamps or pay for standard postage for your franking machine, you’ll pay no VAT because “universal postage services” provided by the Post Office are exempt. … That means the postage is part of the total cost of the goods and so the VAT rate applicable includes the postage.

Is Royal Mail postage VAT exempt?

Parcel Despatch

Royal Mail Signed For™ will also become liable to VAT if purchased as an add-on to a standard rated service. In all other circumstances it will remain VAT exempt.

Do you charge VAT on delivery?

A delivered good is one for which there is a delivery charge built into the overall amount paid by the customer. For example, if you are charging for goods and delivery, this is classed as a single supply of delivered goods, and hence VAT is chargeable on the total amount including postage.

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Is there VAT on postage Ireland?

If postage is charged separately and paid entirely to An Post, then these charges are not subject to VAT. A trader charges an extra €5 for posting an order and this full amount for postage is paid over to An Post. The €5 may be treated as exempt.

What services are VAT exempt?

There are some goods and services on which VAT is not charged, including:

  • insurance, finance and credit.
  • education and training.
  • fundraising events by charities.
  • subscriptions to membership organisations.
  • selling, leasing and letting of commercial land and buildings – this exemption can be waived.


What is the difference between zero rated and exempt?

For a “zero-rated good,” the government doesn’t tax its sale but allows credits for the value-added tax paid on inputs. If a good or business is “exempt,” the government doesn’t tax the sale of the good, but producers cannot claim a credit for the VAT they pay on inputs to produce it.

Can you claim tax back on postage?

You can claim expenses for: phone, mobile, fax and internet bills. postage. stationery.

Is food VAT exempt?

Most food is VAT-free but you do pay VAT on some food. Some items for human consumption are standard-rated. This includes catering, alcoholic drinks, confectionery, crisps and savoury snacks, hot food, sports drinks, hot takeaways, ice cream, soft drinks and mineral water.

Is insurance VAT exempt?

Insurance transactions are exempt from VAT. Normally VAT cannot be recovered on goods and services bought in to make exempt supplies, see paragraph 7.1 for more information. Some premiums received under contracts of insurance are liable to IPT .

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What percentage is VAT?

The standard rate of VAT increased to 20% on 4 January 2011 (from 17.5%). Some things are exempt from VAT , such as postage stamps, financial and property transactions. The VAT rate businesses charge depends on their goods and services.

How much is VAT on shipping?

23% is the standard rate of VAT. All goods and services that do not fall into the reduced rate categories are charged at this rate.

Is there VAT on courier services?

Courier services supplied within the UK are generally taxable at the standard rate for VAT purposes. You will have to register for VAT if your taxable sales are likely to be above the current VAT threshold. … You will be able to reclaim any VAT you pay on purchases – this is known as ‘input tax’.

How can I avoid paying VAT?

Avoid paying VAT – the legal way

  1. Make your own sandwiches. You don’t pay VAT on most food stuffs, especially basic ingredients such as bread, salad, fruit and cheese. …
  2. Buy biscuits carefully. …
  3. Give books as presents. …
  4. Don’t buy drinks on the go. …
  5. Holiday overseas. …
  6. Make your own smoothies. …
  7. Buy kids clothes. …
  8. Buy from overseas sites.


What is the 2/3 rule for VAT?

Two Thirds Rule

If a combination of goods and services is supplied for a single price, provided the value of goods exceeds two-thirds of the total price for the job, the entire transaction is treated as a supply of goods (not a service).

What goods and services are exempt from VAT in Ireland?

Zero rate of VAT

  • exports.
  • intra-Community supplies of goods to VAT-registered persons in other European Union (EU) Member States.
  • certain food and drink.
  • certain oral medicine.
  • certain books and booklets.
  • certain animal feeding stuffs, certain fertilisers, seeds and plants used to produce food.
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