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  • manishthanki34

How does Vat work?

Vat is a tax on goods. If the person you are being from is Vat registered, he will add 20% to the final price.

So if something is £100, 20% needs to be added.

£100+ 20/100



However, as a customer you pay the final price and sometimes do not see the VAT breakdown.

It is possible to work it out.

Taking the same example, the price you paid was £120.

You use a fraction of 1/6.

So 1/6 x £120= £100

Thus £120-100= Vat paid.

When you fill in your Vat return, you claim £20 back.

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