VAT-inclusive flat rate 11% = 13.2% VAT-exclusive flat rate “11%*1.2 = 13.2%”
But it is not a formula. That is my point.
In the example, the standard VAT rate is 20%
The assumed flat rate for the industry is 11%
So if you want to bill a customer for an item which will cost them £1, you put the 20% Vat on it (standard output Vat ) which makes it £1.2 (invoice total)
The flat rate is then calculated on the £1.2.
This makes the flat rate 13.2%
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1.2 represents 20% normal VAT rate which applies to UK.
If normal VAT rate is 30%, then you multiply by 1.3.
Thanks Lubos, this is what i was looking for
Hey Lubos, I would like to know how I would go about a scenario where I have to apply 2 similar tax codes as highlighted above to the same transaction.