What VAT Rate do you charge on Bank Charges & MOT's?

Answer 1

No vat on bank charges and MOTs 0%.

Answer 2

Bank Charges Vat

Answer 3

Vat On Bank Charges

Answer 4

There's no VAT on bank charges and MoT's are not vatable. In Sage accounting, bank charges are T9 and MoT's are T2.

Answer 5

VAT on MOT charges depends on whether you are the agent or not.
If you are the testing garage it is exempt.
If you are the agent garage, and someone else does the MOT, then it's chargeable at 17.5%

Answer 6

Bank Charges are not taxed
17.5% on MOT

Answer 7

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The bank base rate you refer to is a rate set by the Bank of England for short term loans to other banks. Usually these loans are overnight (and generally for not more than 1 week). Banks borrow short term like this in order to maintain their liquidity. For example, a bank may have conducted transactions on a given day which have entailed paying out more cash than they actually hold. The bank knows that the following day they will receive enough cash to cover this shortfall but they need to borrow overnight to cover the transactions so that the books balance. On the other hand, a bank may have a surplus of cash which can't be invested on any sort of long term basis. In this case they may lend it to the Bank of England for a day or two rather than let it lie in the vaults earning nothing. The rate at which this borrowing and lending is conducted is the Bank of England Base Rate. The lower it is the more banks are (supposedly) encouraged to be active in lending money commercially because maintaining their liquidity on a day to day to basis is cheaper - they can lend cash knowing that they themselves can borrow short term to cover any amounts they don't actually hold in the vaults on a given day. The rate at which a bank lends to "Joe Public" has to take into account the running costs of the bank and the profit margin it needs to make to keep shareholders happy. It must also factor in the risk of a loan going wrong (defaults and bad debts). Consequently the borrowing rate offered to customers will always be higher (much higher depending on risk) than the base rate. This is a very simplistic answer and is really just a simple explanation of the relationship of base rate to normal lending rates. It should also be pointed out that when a bank borrows overnight it does not mean it is on the verge of going bust - the bank will have billions in assets which cannot be turned to into cash quickly - it's a bit like an individual using an overdraft rather than selling an asset to pay a bill, knowing that that he/she will have the cash in their account in a day or two.

Answer 8

VAT is a standard rate of 17.5%

There are a couple of exceptions, but not really everyday items or services.

Answer 9

Bank charges are exempt from VAT.
MOT's are vatable at 17.5%.

Answer 10

There is no VAT on these transactions