GLOSSARY
Zero-rate definition
What does Zero-rate mean?
Supplies (but not acquisitions or importations) are said to be zero-rated if they are relieved by legislation from a charge to tax.
Zero-rated supplies, in contrast to exempt supplies, are treated as if they are taxable supplies chargeable to tax at nil rate. Accordingly, they are taken into account in determining whether a trader is liable or entitled to be registered. Moreover, input tax credit is allowed for any VAT attributable to a zero-rated supply. A supply of goods or services is zero-rated if the supply, or the goods or services being supplied, fall within the descriptions contained in VATA 1994, Sch 8. Zero-rating has priority over both exemption and a charge to tax at the standard or reduced rate,
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