Output tax definition

/ˈaʊtpʊt/ /taks/

What does Output tax mean?

Output tax is the tax that a VAT registered business is required to charge on its taxable supplies (broadly, its sales) at the standard and reduced rates of VAT. It is payable to HMRC after the deduction of any recoverable input tax.

In some cases the liability to account for output tax becomes the liability of the purchaser, rather than the seller. This is known as the reverse charge. In those cases, the output tax is simultaneously recoverable as input tax, subject to any restrictions which may apply. 

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