Retail schemes — Apportionment

Copyright © 2026 LexisNexis
Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance

Retail schemes — Apportionment

Copyright © 2026 LexisNexis
Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance
imgtext

This guidance note provides an overview of the rules relating to the apportionment retail schemes. This note should be read in conjunction with the Retail schemes — overview and Retail schemes — specific industries guidance notes.

A business making retail sales can use a retail scheme if they cannot use the normal accounting rules and their VAT exclusive turnover does not exceed £130m a year.

The retail scheme used by the business must produce a fair and reasonable result and the business must be able to identify the tax exclusive value of the sale, the applicable VAT rate and be able to produce periodic totals of those amounts.

Overview of the appointment schemes

There are two apportionment schemes that can be used. Although both use broadly the same mechanism (an apportionment between different VAT rates) apportionment scheme 1 analyses the proportion of purchases at different VAT rates and applies this ratio to sales, whereas scheme 2 uses the expected selling price of goods received for retail sale as the basis for apportionment.

Apportionment

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
TAKE A FREE TRIAL NOW
Powered by Tolley+™
  • 30 Mar 2026 10:39

Home/ Tolley Tax Guidance/ Value Added Tax / Choosing and operating a special VAT scheme

Popular Articles

Owner-Managed Businesses

SEIS and EIS ― overview

SEIS and EIS ― overviewThe seed enterprise investment scheme (SEIS) and enterprise investment scheme (EIS) are very similar schemes which offer substantial tax incentives to investors in companies which qualify. The tax incentives for SEIS and EIS investments are intended to encourage investment in

14 Jul 2020 13:31 | Produced by Tolley Read more Read more
Owner-Managed Businesses

Repairs and renewals

Repairs and renewalsThe key consideration in determining whether expenditure on repairs and renewals is allowable as a deduction for tax purposes is whether it is capital or revenue in nature. In some cases, it can be relatively straightforward to identify revenue repairs. HMRC provides the

14 Jul 2020 13:23 | Produced by Tolley Read more Read more
Value Added Tax

VAT registration ― change of VAT registration details

VAT registration ― change of VAT registration detailsVAT registered persons must keep their VAT registration details up to date and notify HMRC of any changes. Failure to notify HMRC by the relevant time could result in a penalty. For guidance regarding penalties for failure to notify please see the

14 Jul 2020 13:57 | Produced by Tolley Read more Read more