From 1 January 2019 the low VAT rate of 6% will increase to 9%. We recommend that you take this into account when preparing quotations for 2019 and in the set up of your financial accounting for 2019.

 

The lower VAT rate of 6% may still be applied for work or goods invoiced and paid for in 2018 but which will only be carried out or supplied in 2019. This could include tickets bought in 2018 for a concert which will take place in 2019. The same will also apply to plastering and decoration work on buildings older than two years, which runs into 2019.

 

So it may be worthwhile to pay for future work in advance in 2018. It could yield a tax benefit of 3%.

The low VAT rate applies to certain goods and services as specified in the legislation, such as:

 

  • Foodstuffs (with the exception of alcoholic drinks and tobacco);
  • Medicines;
  • Books, newspapers and magazines;
  • The services of bicycle mechanics, shoemakers, tailors and dressmakers, hairdressers, etc.;
  • The plastering and decorating of properties more than two years old;
  • House cleaning;
  • Facilities for sports and exercise;
  • Entrance tickets for museums, theatre and music performances, sporting events, etc.

 

If you want to know what rate applies to the goods or services that you provide, please contact us!