VAT Margin Scheme Calculator

Work out VAT on the margin, not the full price, for second-hand goods, antiques, art and collectors' items sold under the UK, Irish or EU margin scheme.

Your numbers

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Selling price

What you paid for it

Only stock bought without a VAT invoice qualifies, e.g. from a private individual or a seller who didn't charge you VAT.

VAT rate

20% in the UK. Ireland and most other EU countries apply their own standard rate to the margin instead.

Your result · updates as you type

VAT due under the margin scheme

$25.00

VAT is charged only on the $150.00 margin (selling price minus what you paid), not the full $450.00 selling price. At 20%, that's $25.00, leaving you $125.00 after VAT.

Margin: $150.00
VAT due: $25.00
Margin after VAT: $125.00

The margin scheme covers second-hand goods, antiques, art and collectors' items bought without being charged VAT. You can't also reclaim VAT on the original purchase, and you can't show VAT separately on the sales invoice. If you sell a lot of low-value items, look into the Global Accounting variant, which totals the margin across a whole VAT period instead of per item.

Breakdown

Selling price: $450.00
What you paid: $300.00
Margin (VAT-inclusive): $150.00
VAT (margin × 20 ÷ 120): $25.00
Margin kept after VAT: $125.00

VAT on the margin, not the price

Ordinarily VAT is charged on the full selling price. The margin scheme is different: because the goods already had VAT paid on them once (often by a private individual who couldn't reclaim it), VAT is charged only on your profit margin.

VAT due = margin × VAT rate ÷ (100 + VAT rate), where margin = selling price − purchase price

Example: the default numbers (UK, 20%)

Selling price: £450
What you paid: £300
Margin: £150

VAT due = 150 × 20 ÷ 120 = £25.00 (one-sixth of the margin). You keep £125.00 after VAT.

What qualifies

Eligible: second-hand goods, antiques, works of art and collectors' items, bought without being charged VAT, typically from a private individual or an unregistered seller.
Not eligible: anything you were charged VAT on when you bought it. Precious metals, investment gold and precious stones are also excluded in the UK.
Can't reclaim VAT on the purchase if you use the margin scheme, and you can't show VAT separately on the sales invoice.
No margin, no VAT. If you sell at or below what you paid, there's no VAT due on that item under the scheme.

Selling a lot of low-value items

Calculating VAT item by item gets tedious at volume. The Global Accounting variant of the scheme totals your purchases and sales across a whole VAT period instead, and works VAT on the overall margin: total sales minus total purchases for eligible stock, times the same rate.

Questions people ask

What is the VAT margin scheme?

A scheme that lets sellers of second-hand goods, antiques, art and collectors' items charge VAT only on their profit margin (selling price minus purchase price), instead of the full selling price.

How is VAT worked out under the margin scheme?

As a fraction of the VAT-inclusive margin: rate ÷ (100 + rate). At the UK's 20% standard rate, that's one-sixth of the margin.

What if I sell an item for less than I paid?

There's no VAT due on that item under the scheme, since there's no margin. Some versions of the scheme let a loss offset a profit elsewhere in the same VAT period.

Can I use the margin scheme for anything I bought secondhand?

Only if you weren't charged VAT on the purchase, which usually means you bought it from a private individual or an unregistered business, not another VAT-registered trader who charged you VAT.

Last reviewed 30 September 2026.

Sources: GOV.UK: VAT margin schemes