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Hi,
Could someone please confirm this is correct:
I am a VAT registered retailer. I purchase a product (standard rate 20% VAT) from a wholesaler and sell it on as follows:
Wholesale price = £10 (exc VAT) / £12 (inc VAT)
I mark it up by 50%
Retail price = £15 (exc VAT) / £18 (inc VAT)
So to apply VAT to the RRP, I am essentially marking up the VAT the wholesaler applied by 50% (£12 + 50% = £18). I don't add any additional VAT to the RRP.
Amount of VAT paid to HMRC for this product: £3 - £2 = £1.00
Appreciate the help
A
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