Guide to UK Taxability and VAT Rates

How UK Taxability Is Determined

Kintsugi evaluates UK taxability using country-level address data. The platform analyzes the following address components to determine whether VAT applies:

• Country

• Building number

• Street name

• Locality

• City or town

• County

• Postal code

Important: The UK does not have local or regional tax overrides. VAT determination is consistent across all UK addresses.

VAT Rates in the UK

The UK applies three primary VAT rates depending on the type of goods or services you provide:

• Standard rate: 20% (applies to most goods and services)

• Reduced rate: 5% (applies to specific goods and services, such as children's car seats and home energy)

• Zero-rated and exempt supplies: Certain items qualify as zero-rated or exempt under UK VAT rules

Kintsugi supports all UK VAT rates to ensure accurate tax calculations for your business.

Digital Services

VAT treatment for digital services depends on whether your customer is a business (B2B) or consumer (B2C):

When you're registered for VAT:

• B2C digital services supplied to UK customers are subject to VAT.

• B2B digital services are not subject to VAT collection by default, as the reverse charge mechanism typically applies.

VAT ID Format

UK VAT registration numbers follow a standard format:

• Format: 9 digits with an optional GB prefix

• Example: GB123456789

When validating customer VAT IDs or entering your own registration number, you may include or omit the GB prefix.

Need help?

If you need help with UK VAT compliance, please contact our support team or explore our other help articles for guidance on registration, filing, and managing your tax obligations across multiple jurisdictions.