UK VAT rates in 2026/27: what's charged at 20%, 5% and 0%
There isn't just one VAT rate in the UK. There are three, and which one applies depends on what you're buying or selling, not who's involved in the sale. Here's how each one works, with real examples for each band.
The standard rate: 20%
Most goods and services in the UK are charged at the standard rate of 20%. If a product or service isn't listed under the reduced or zero rate, it's almost certainly standard-rated. Clothing for adults, electronics, alcohol, most restaurant meals and professional services all fall here.
The reduced rate: 5%
A smaller set of goods and services gets the reduced 5% rate. The main examples are:
- Domestic gas, electricity, heating oil and solid fuel for home use
- Mobility aids for people over 60, when bought for personal use at home
- Children's car seats, booster seats and booster cushions
- Some energy-saving home improvements funded through government grant schemes, such as certain boilers and heating controls
- Converting a building into more homes, or renovating a home that's been empty for two years or more
The zero rate: 0%
Zero-rated items are still technically "taxable", just at a rate of nothing. This matters because they count towards your VAT-registration turnover, unlike exempt items (more on that below). Common examples include:
- Most food and drink for human consumption, though not restaurant meals, hot takeaway food, alcohol, confectionery, crisps or soft drinks
- Children's clothes and shoes
- Books, newspapers and magazines, in print or as e-books
- Public transport fares
- Prescription medicines dispensed by a pharmacist
- Equipment designed for disabled or blind people
- New builds, when constructing certain residential or charitable buildings
Zero-rated versus exempt: what's the difference?
These two get mixed up a lot. A zero-rated sale is still a VAT sale, just charged at 0%. It adds to your taxable turnover for VAT registration. An exempt sale doesn't. Insurance, postage stamps and most property and financial deals are exempt: they sit outside the VAT system altogether.
Temporary VAT rate: summer 2026
From 25 June 2026 to 1 September 2026, HMRC is running a temporary 5% rate. It covers children's meals eaten on the premises, and admission to family venues like zoos, farms, museums, fairs, amusement parks and soft-play centres. It's a summer holiday measure, and prices revert to normal once it ends.
Not sure which rate applies to something you sell?
HMRC publishes a detailed list of VAT rates by product and service on gov.uk. If your product doesn't clearly fit standard, reduced or zero rate, it's worth checking there directly, or asking an accountant, since getting it wrong on an invoice can cause problems later.
Frequently asked questions
How much is VAT in the UK? +
Most things are charged at the standard rate of 20%. A smaller group of goods and services gets the reduced rate of 5%, and some are zero-rated at 0%. The rate depends on what is being sold, not on who is buying it.
What is zero-rated VAT? +
Zero-rated means VAT is charged at 0%. It still counts as a taxable supply (which matters for your VAT return), but no VAT is added to the price. Most food, books, newspapers and children's clothes are zero-rated.
What's the difference between zero-rated and VAT-exempt? +
Zero-rated goods are taxable at 0%, so they count towards your VAT-taxable turnover. Exempt goods and services, like postage stamps, insurance and most financial transactions, sit outside the VAT system entirely and don't count towards your turnover for registration purposes.
Are there any temporary VAT rate changes right now? +
Yes. From 25 June 2026 to 1 September 2026, a temporary 5% rate applies to children's meals eaten on the premises, and to admission to places like zoos, farms, museums, fairs and soft-play centres. It runs over the school summer holidays and then reverts to the normal rate.
Need to work out an actual VAT figure? Try the VAT calculator, or check whether you need to register for VAT.