Flat Rate VAT Calculator: What Would You Pay on the Flat Rate Scheme?

By VAT Calculatorz · Last updated: October 2026

Definition: Under the Flat Rate Scheme, instead of working out the VAT on every sale and purchase, you pay HMRC a single fixed percentage of your VAT-inclusive turnover. The percentage depends on your trade sector — and you keep the difference between the VAT you charge customers and the flat rate you pay over.

Quick answer: Multiply your VAT-inclusive turnover for the period by your sector's percentage. An accountant on £12,000 of VAT-inclusive turnover pays 14.5% = £1,740; in the first year of VAT registration the 1% discount drops the rate to 13.5% = £1,620. Businesses that spend very little on goods (limited cost traders) use 16.5% whatever their sector. Try your own figures below.

Work Out Your Flat Rate VAT

Your turnover and your trade — that is all it takes.

VAT-inclusive turnover for the period (£) — everything you billed, including the VAT you charged Your trade sector First year of VAT registrationYou get 1 percentage point off your rate. I'm a limited cost traderYour rate is 16.5% whatever your sector — the sector choice above is ignored.

For everyday adding or removing VAT, use our main VAT Calculator — the free tool on our homepage. It works out the net, the VAT and the gross in one step.

This flat rate calculator is a specialist helper for one job: the Flat Rate Scheme. For everything else, the main calculator is the one to bookmark.

Open the Main VAT Calculator →

How the Flat Rate Scheme Works

Who can join: VAT-registered businesses expecting VAT taxable turnover of £150,000 or less (excluding VAT) in the next 12 months. Our guide to the Flat Rate Scheme covers joining, leaving and the cash-based method in full.
You charge VAT as normal — your invoices and prices do not change.
You pay HMRC your sector percentage of your VAT-inclusive turnover for each period, and keep the difference.
You cannot reclaim VAT on purchases — except single capital assets costing £2,000 or more including VAT.
You must leave the scheme if your turnover including VAT passes £230,000 in the last 12 months (checked on the anniversary of joining), or you expect income of more than £230,000 in the next 30 days alone.
Still deciding about registration itself? See the £90,000 VAT registration threshold explained, and our guide to working out VAT on your sales under standard accounting.

Flat Rate Percentages by Sector

The full list of HMRC flat rates (GOV.UK, checked October 2026). Find your business type, then run your figures in the calculator above.

Type of business	VAT flat rate
Accountancy or book-keeping	14.5%
Advertising	11%
Agricultural services	11%
Any other activity not listed elsewhere	12%
Architect, civil and structural engineer or surveyor	14.5%
Boarding or care of animals	12%
Business services not listed elsewhere	12%
Catering services including restaurants and takeaways	12.5%
Computer and IT consultancy or data processing	14.5%
Computer repair services	10.5%
Entertainment or journalism	12.5%
Estate agency or property management services	12%
Farming or agriculture not listed elsewhere	6.5%
Film, radio, television or video production	13%
Financial services	13.5%
Forestry or fishing	10.5%
General building or construction services*	9.5%
Hairdressing or other beauty treatment services	13%
Hiring or renting goods	9.5%
Hotel or accommodation	10.5%
Investigation or security	12%
Labour-only building or construction services*	14.5%
Laundry or dry-cleaning services	12%
Lawyer or legal services	14.5%
Library, archive, museum or other cultural activity	9.5%
Management consultancy	14%
Manufacturing fabricated metal products	10.5%
Manufacturing food	9%
Manufacturing not listed elsewhere	9.5%
Manufacturing yarn, textiles or clothing	9%
Membership organisation	8%
Mining or quarrying	10%
Packaging	9%
Photography	11%
Post offices	5%
Printing	8.5%
Publishing	11%
Pubs	6.5%
Real estate activity not listed elsewhere	14%
Repairing personal or household goods	10%
Repairing vehicles	8.5%
Retailing food, confectionery, tobacco, newspapers or children's clothing	4%
Retailing pharmaceuticals, medical goods, cosmetics or toiletries	8%
Retailing not listed elsewhere	7.5%
Retailing vehicles or fuel	6.5%
Secretarial services	13%
Social work	11%
Sport or recreation	8.5%
Transport or storage, including couriers, freight, removals and taxis	10%
Travel agency	10.5%
Veterinary medicine	11%
Wholesaling agricultural products	8%
Wholesaling food	7.5%
Wholesaling not listed elsewhere	8.5%
Limited cost trader (any sector)	16.5%

* "Labour-only building or construction services" means building services where the value of the materials supplied is less than 10% of the turnover for those services. If materials are worth more than that, the business is classed as "General building or construction services".

The 1% First-Year Discount

During your first year as a VAT-registered business, you take 1 percentage point off your flat rate. A photographer at 11% pays 10%; an accountant at 14.5% pays 13.5%. The discount runs from the date you registered for VAT, not the date you joined the scheme — tick the box in the calculator if it applies to you.

Limited Cost Traders: The 16.5% Rate

If your business buys very few goods, HMRC classes you as a limited cost trader and you must use 16.5% — whatever your sector. The test: the cost of your goods is less than 2% of your turnover, or less than £1,000 a year if your goods cost is more than 2% of turnover. "Goods" here is a narrow HMRC list — most services, rent, software subscriptions and similar overheads do not count. Many one-person service businesses are caught by this, which is why the calculator asks the question directly.

Who the Scheme Suits — and Who It Doesn't

It often suits you if:

You sell mainly services and buy very little that carries VAT.
Your customers are mostly the public or others who cannot reclaim VAT, so charging full VAT does not cost you sales.
You want simpler VAT paperwork — one multiplication per period instead of VAT on every transaction.

It often does not suit you if:

You buy a lot of stock or goods with VAT on them — you cannot reclaim that VAT on the scheme.
Most of your sales are zero-rated — you still pay the flat rate on that turnover, even though you charged no VAT on it.
You regularly claim VAT repayments, or you are making a big capital purchase you could reclaim VAT on under standard accounting.

Sources and References

This calculator is general information, not tax advice. Whether the scheme saves you money depends on your real mix of sales and purchases — an accountant can model your actual figures before you apply.

FAQs

How do I calculate VAT on the Flat Rate Scheme?

Multiply your VAT-inclusive turnover for the period by your trade sector's flat rate percentage. For example, an accountant with £12,000 of VAT-inclusive turnover pays 14.5% × £12,000 = £1,740 to HMRC for that period.

Which turnover figure do I use — with or without VAT?

Use the VAT-inclusive figure — everything you billed in the period including the VAT you charged, across your standard, reduced and zero-rated sales. The flat rate percentage is designed to be applied to the gross, VAT-inclusive total, not the net.

Can I reclaim VAT on my purchases on the Flat Rate Scheme?

No — that is the trade-off for the simpler maths. You cannot reclaim VAT on your purchases while you are on the scheme, except on single capital assets that cost £2,000 or more including VAT, such as equipment.

What is a limited cost trader?

HMRC classes you as a limited cost trader if the goods you buy cost less than 2% of your turnover — or less than £1,000 a year if your goods cost is more than 2% of turnover. Limited cost traders use a flat rate of 16.5% whatever their trade sector.

Who can join the Flat Rate Scheme?

Any VAT-registered business that expects its VAT taxable turnover to be £150,000 or less (excluding VAT) in the next 12 months can apply to join. You must leave the scheme if your turnover with VAT included goes over £230,000 in a 12-month period.

Do I get a discount in my first year on the Flat Rate Scheme?

Yes. During your first year as a VAT-registered business you take 1 percentage point off your flat rate. A sector rate of 14.5% becomes 13.5% for that first year — on £12,000 of VAT-inclusive turnover that is £1,620 instead of £1,740.

For everyday adding or removing VAT, use our free main VAT Calculator on the homepage.