What is zero rate?
A transaction with a zero rate is subject to VAT but at a rate of 0%. The difference from an exemption: at a zero rate the trader is entitled to deduct input VAT, with an exemption - not.
Zero rate transactions
- Export of goods
- Providing service to a foreign resident (under certain conditions)
- Selling fresh fruits and vegetables
- Sale of an intangible asset to a foreign resident
Advantage
Exporters benefit from a zero rate - they do not collect VAT from customers abroad, but receive an input VAT refund from the tax authority.
Important Note: The information on this website is for general informational purposes only and does not constitute professional tax advice. Consult a qualified tax advisor before making financial decisions.