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How VAT works

Output tax and input tax, the three rates, what is exempt, who has to register, and how to take VAT out of a price.

Free5 rooms45 questions47 min

This path is practice in how the records and the sums work. It is not tax advice. Any rate or allowance in a question is an example for that question, so check GOV.UK for the current figures.

Start this moduleOutput tax and input tax: which is which?

Rooms in this module

  1. 1Output tax and input tax: which is which?10 min, easyFree
  2. 2Standard, reduced and zero rate: which applies?8 min, easyFree
  3. 3Exempt or outside the scope: what is the difference?9 min, mediumFree
  4. 4Who has to register for VAT?10 min, mediumFree
  5. 5How to get from a VAT inclusive price to the net10 min, mediumFree

How this works

Each room answers one problem. A task is a few lines of reading, then questions you answer in the books: post to an account, type a figure, sort, match or write a journal. Every answer is marked at once, with the rule behind it. There are no videos.

Words in this module

Input tax
Input tax is the VAT a business pays on its purchases and expenses. It can usually be claimed back from HMRC.
Output tax
Output tax is the VAT a business charges on its sales. It is owed to HMRC.

Questions

How many rooms and questions are in How VAT works?

5 rooms and 45 questions. Every question is marked at once.

How long does it take?

About 47 minutes in all. A room takes 8 to 10 minutes, so you can do one at a time.

Is it free?

Yes. Every room in this module is free, and you can start with no account.

What should I do first?

Nothing. This is the first module of VAT in practice, so you can start here.