Updated for 2026/27 Tax Year
VAT Margin Scheme Calculator
Calculate VAT on the profit margin for second-hand goods, works of art, antiques, and collectors' items.
Calculate Margin Scheme VAT
Enter the purchase price (what you paid) and selling price
What you paid for the item
What you sell it for (inc. VAT)
Margin Scheme Results
Profit Margin
£2500.00
VAT on Margin (1/6)
£416.67
Net Profit After VAT
£2083.33
Effective VAT Rate
5.56%
Comparison with Standard VAT
Standard VAT (20%)
£1500.00
Margin Scheme VAT
£416.67
You Save
£1083.33
How the Margin Scheme Works
Under the VAT Margin Scheme, you only pay VAT on the difference between what you paid for an item and what you sell it for (the margin), not on the full selling price.
Calculation Method
VAT = Margin ÷ 6 (which is equivalent to 1/6 of the margin, or 16.67%)
Eligible Items
- • Second-hand goods
- • Works of art
- • Antiques
- • Collectors' items
Requirements
- • Bought from non-VAT registered person
- • Or from someone using margin scheme
- • Must keep detailed stock records
Related Calculators
Global Accounting
If you sell many similar items, you may be able to use global accounting to simplify your records.