Official Statistics

Annual UK VAT statistics 2022 to 2023 commentary

Updated 29 November 2023

© Crown copyright 2023

This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gov.uk.

Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.

This publication is available at https://www.gov.uk/government/statistics/value-added-tax-vat-annual-statistics/annual-uk-vat-statistics-2022-to-2023-commentary

1. Headlines

The latest headlines for Value Added Tax (VAT) statistics are:

  • total VAT receipts in the financial year 2022-23 increased by 1% to £160 billion compared to £158 billion in 2021-22.

  • during 2022-23, the VAT population was 2,392,790. There were 2,464,109 live traders as at March 2023, with 277,441 new registrations and 397,675 deregistrations in-year.

  • total net Home VAT liabilty in 2022-23 was £156.76 billion.

  • the Wholesale and Retail sector was the largest contributor to net Home VAT liability (32%) with a total of £50 billion.

  • 75% of total net Home VAT liability (£117 billion) was paid by traders with an annual turnover of greater than £10 million.

Receipts dropped significantly between March 2020 and June 2020 due to the VAT payment deferment policy. There is further information on the VAT payment deferment policy on GOV.UK. Further reductions in receipts across the April 2020 to March 2021 financial year can be attributed to economic impacts of the Covid-19 pandemic as well as the temporary reduced rate of 5% for hospitality, holiday accommodation and attractions. There is further information on this temporary reduction on GOV.UK.

2. About this release

This official statistics publication provides information on VAT receipts, Home VAT and Import VAT. It also includes Home VAT declared on traders’ returns classified by sector, sub-sector and trade group as well as information on VAT registrations, de-registrations and trader population.

As the UK has now left the EU, Table 13 showing details on VAT Mini One Stop Shop (MOSS) is no longer applicable and so has been removed from the publication. Previous versions of this statistics release are available on the National Archives website.

As part of a programme of continuous improvement, the publication as a whole has undergone several changes to enhance the user experience and achieve greater accessibility. HMRC welcomes user engagement to improve the departments National and Official Statistics. You can contact statistics producers via our feedback avenues.

Value Added Tax (VAT) is charged when a VAT-registered business sell goods or services to another business or non-business customer. When VAT-registered businesses buy goods or services, they can generally reclaim the VAT they have paid.

There are three rates of VAT depending on the goods or services the business provides:

  • standard: 20%
  • reduced: 5%
  • zero: 0%

There are also some goods and services that are:

  • exempt from VAT
  • outside the UK VAT system completely

There is further information on VAT rates on GOV.UK.

There are three main measures of VAT revenue:

  • on an accurals basis (when the VAT liability arose)
  • on a declared liability basis (when HMRC is notified of the VAT liabilty)
  • on a cash receipts basis (when VAT was paid to HMRC)

3. VAT receipts

Total VAT receipts are equal to Home VAT receipts plus non-postponed accounting import VAT receipts and is the amount paid to HMRC including any accounting adjustments to remove penalties and occasional payment errors.

Net Home VAT receipts are equal to Home VAT payments made to HMRC by registered taxpayers minus Home VAT repayments made from HMRC to taxpayers. Taxpayers will make payment to HMRC when their net Home VAT liability is positive and will receive repayments when their net Home VAT liability is negative.

For the full dataset that accompanies Figure 1 go to Value Added Tax (VAT) tables 2022 to 2023.

Figure 1 illustrates the following trends for Total VAT, Home VAT and Non-postponed accounting import VAT receipts:

  • in 2022-23 Total VAT and Home VAT receipts were the highest on record.

  • total VAT receipts for 2022-23 was £160 billion. This was composed of £147 billion of Home VAT receipts and £13 billion of Non-postponed accounting import VAT receipts.

  • during 2022 to 2023, Home VAT receipts increased by £5 billion and Non-postponed accounting import VAT receipts decreased by £3 billion.

Figure 1: VAT receipts for the previous ten financial years to 2022-23.
Financial Year Home VAT (£ billion) Mixed Import VAT* (£ billion) Non-Postponed Accounting Import VAT (£ billion) Non-EU Import VAT (£ billion) Total VAT (£ billion)
2013-14 79.5 0.0 0.0 25.2 104.7
2014-15 86.0 0.0 0.0 25.4 111.4
2015-16 89.2 0.0 0.0 25.7 114.9
2016-17 91.8 0.0 0.0 28.0 119.8
2017-18 96.2 0.0 0.0 30.3 126.4
2018-19 99.8 0.0 0.0 32.8 132.5
2019-20 97.5 0.0 0.0 32.4 129.9
2020-21 73.4 28.2 0.0 0.0 101.6
2021-22 141.4 0.0 16.2 0.0 157.5
2022-23 146.7 0.0 13.0 0.0 159.7

*All non-EU import VAT up to 31 December 2020 and non-postponed accounting import VAT from 1 January 2021.

For the full dataset that accompanies Figure 1 go to Value Added Tax (VAT) tables 2022 to 2023.

Figure 2 illustrates the following trends for payment and repayment receipts:

  • in 2022-23, payment and repayment receipts were the highest on record.

  • net Home VAT receipts for 2022-23 were composed of £254.6 billion of payment receipts and -£107.8 billion of repayment receipts.

Figure 2: VAT payment and repayment receipts for the previous ten financial years to 2022-23.
Financial Year Repayments (£ billion) Payments (£ billion) Net Home VAT receipts (£ billion)
2013-14 -73.3 152.8 79.5
2014-15 -75.8 161.8 86.0
2015-16 -77.2 166.4 89.2
2016-17 -81.0 172.7 91.8
2017-18 -85.0 181.1 96.2
2018-19 -89.4 189.2 99.8
2019-20 -92.0 189.5 97.5
2020-21 -88.4 161.8 73.4
2021-22 -96.3 237.7 141.4
2022-23 -107.8 254.6 146.7

For the full dataset that accompanies Figure 2 go to Value Added Tax (VAT) tables 2022 to 2023.

4. VAT population

VAT population figures refer to the live trader population during the year; those VAT registered traders active at 31 March of the fiscal year or who had submitted a non-nil return through the year.

Businesses need to register for VAT when their turnover of VAT taxable goods and services is over the VAT registration threshold; businesses below the VAT registration threshold may also choose to voluntarily register.

4.1 Overview

Figure 3 illustrates the following trends in the VAT population to March 2023:

  • the number of traders has reduced by 161,680 in 2022-23.

  • over the previous ten years, the VAT popluation has increased by 331,570 (16.1%).

Figure 3: Total VAT population over the last 10 years to 2022-23.
Financial Year VAT Population
2013-14 2,061,220
2014-15 2,128,080
2015-16 2,217,840
2016-17 2,308,580
2017-18 2,331,730
2018-19 2,352,250
2019-20 2,454,910
2020-21 2,481,330
2021-22 2,554,470
2022-23 2,392,790

For the full dataset that accompanies Figure 3 go to Value Added Tax (VAT) tables 2022 to 2023.

4.2 Sector

Figure 4 illustrates the following trends in the VAT population from the top 10 trade sectors:

  • the Wholesale and Retail sector was the largest in terms of contribution to the VAT population (517,960) in the financial year ending March 2023, 22% of the total.

  • the VAT population for the Professional, Scientific and Technical Activities sector and Construction sector were 350,170 and 349,490 respectively in the financial year ending March 2023, the second and third largest contributors.

Figure 4: Contribution to the VAT population from the top 10 trade sectors for the financial year ending March 2023.
Sector Number of Traders
Wholesale and Retail 517,960
Professional, Scientific and Technical Activities 350,170
Construction 349,500
Information and Communications 187,250
Administrative and Support Service Activities 150,670
Manufacturing 141,800
Accommodation and Food Service Activities 137,920
Agriculture, Forestry and Fishing 132,410
Transportation and Storage 122,220
Real Estate Activities 108,330

For the full dataset that accompanies Figure 4 go to Value Added Tax (VAT) tables 2022 to 2023.

4.3 Business type

Figure 5 illustrates the following trends in the VAT population across the business types:

  • in 2022-23, incorporated companies represented 74.0% of the total VAT population.
Figure 5: VAT population by business type for the financial year ending March 2023.
Business Type Number of Traders
Incorporated company 1,770,240
Sole proprietor 321,080
Partnership 190,580
Unknown 60,810
Non profit making body or mutual association (other than a corporate body) 46,470
Local authority 1,990
Public corporation or nationalised industry 1,610

For the full dataset that accompanies Figure 5 go to Value Added Tax (VAT) tables 2022 to 2023.

4.4 Turnover band

Before 2022 to 2023, traders with a negative turnover were previously classified as having an unknown turnover. For 2022 to 2023 onwards, these are recorded in the newly labelled ‘Negative or £0’. This better reflects where they are in the distribution. It is not feasible to implement this improvement to previous years. Therefore, historic figures are not directly comparable. For context, these traders account for only 0.2% of the total population in 2022 to 2023. The further reduction in unknown in 2022 to 2023 is largely due to improvements in how taxpayers are registered.

Figure 6 illustrates the following trends in trader population across the annual turnover bands. For the year ending March 2023:

  • the largest proportion of traders were in the £1 to threshold annual turnover band (29.5%).

  • 46% of traders declared an annual turnover up to and including the VAT registration threshold (currently set at £85,000).

Figure 6: VAT population by annual turnover bands for the financial year ending March 2023.
Turnover Band Number of Traders
Negative or £0 402,860
£1 to threshold 705,960
> threshold to £150,000 307,250
> £150,000 to £300,000 331,490
> £300,000 to £500,000 181,670
> £500,000 to £1m 176,740
> £1m to £10m 231,290
> £10m 44,090

Note: The sum of the percentages below does not equal 100%, as the total number of traders those where the turnover band is ‘Unknown’ and therefore are not included in chart above. ‘Unknown’ traders account for 0.48% of total traders.

For the full dataset that accompanies Figure 6 go to Value Added Tax (VAT) tables 2022 to 2023.

5. VAT liabilities

The net tax declared on VAT returns will not be the same as the payments and repayments made by a business. It will not include payments or repayments that are unrelated to the returns or where payments/repayments do not match the amount declared on the return (for example where repayment is withheld by HMRC). Net tax relates to Home VAT only.

5.1 Overview

Figure 7 illustrates the following trends in net Home VAT liability to March 2023:

  • net Home VAT liability is currently at an all time high of £156.74 billion. This is an increase of 11.4% compared with 2021-22.

  • over the previous ten years, net Home VAT liability has increased by £68.57 billion (77.8%).

Figure 7: Net Home VAT liability over the last 10 years to 2022-23.
Financial Year Net Home VAT (£ billion)
2013-14 88.2
2014-15 93.1
2015-16 97.2
2016-17 100.1
2017-18 102.9
2018-19 105.3
2019-20 109.1
2020-21 98.2
2021-22 140.7
2022-23 156.7

For the full dataset that accompanies Figure 7 go to Value Added Tax (VAT) tables 2022 to 2023.

5.2 Sector

Figure 8 illustrates the following trends in net Home VAT liability from the top 10 trade sectors:

  • the Wholesale and Retail sector was the largest in terms of contribution to net Home VAT liability (£50 billion) in the financial year ending March 2023, 32% of the total.

  • net Home VAT liability for the Professional, Scientific and Technical Activities sector and Manufacturing sector were £25.03 billion and £23.69 billion respectively in the financial year ending March 2023, the second and third largest contributors.

Figure 8: Contribution to net Home VAT liability from the top 10 trade sectors for the financial year ending March 2023.
Sector Net Home VAT (£ billion)
Wholesale and Retail 49.7
Professional, Scientific and Technical Activities 25.0
Manufacturing 23.7
Information and Communications 17.7
Administrative and Support Service Activities 16.2
Accommodation and Food Service Activities 9.8
Construction 7.5
Electricity, Gas, Steam and Air Conditioning Supply 5.9
Real Estate Activities 4.1
Arts, Entertainment and Recreation 3.4

For the full dataset that accompanies Figure 8 go to Value Added Tax (VAT) tables 2022 to 2023.

Figure 9 illustrates the following trends in changes in net Home VAT liability from the top 10 trade sectors compared to the previous financial year:

  • the Accommodation and Food Service Activities sector increased by £7 billion (+237%), the largest year-on-year change. This was followed by the Electricity, Gas, Steam and Air Conditioning Supply sector which increased by £2.2 billion (+60%).
Figure 9: Year-on-year actual change in Net Home VAT liability of the top 10 contributing sectors for the financial year ending March 2023.
Sector Year on Year Change in Net Home VAT (£ billion)
Accommodation and Food Service Activities 6.9
Electricity, Gas, Steam and Air Conditioning Supply 2.2
Professional, Scientific and Technical Activities 2.0
Manufacturing 1.5
Information and Communications 1.5
Wholesale and Retail 1.4
Arts, Entertainment and Recreation 1.1
Public Administration and Defence; Compulsory Social Security -0.8
Administrative and Support Service Activities 0.6
Construction 0.6

Note: The comparison of the year-on-year changes for Net Home VAT has been impacted by the introduction of postponed accounting for import VAT from January 2021.

For the full dataset that accompanies Figure 9 go to Value Added Tax (VAT) tables 2022 to 2023.

5.3 Business type

Figure 10 illustrates the following trends in Net Home VAT liability across business types. For the year ending March 2023:

  • incorporated company traders contributed £158 billion of net Home VAT liability.
Figure 10: Net Home VAT liability by business type for the financial year ending March 2023.
Business Type Net Home VAT (£ billion)
Incorporated company 157.8
Partnership 5.4
Sole proprietor 2.4
Non profit making body or mutual association other than a corporate body 2.4
Unknown -0.2
Public corporation or nationalised industry -0.4
Local authority -10.6

5.4 Turnover band

Before 2022 to 2023, traders with a negative turnover were previously classified as having an unknown turnover. For 2022 to 2023 onwards, these are recorded in the newly labelled ‘Negative or £0’ category. This better reflects where they are in the distribution. It is not feasible to implement this improvement to previous years. Therefore, historic figures are not directly comparable. For context, these traders account for only 0.2% of the total population in 2022 to 2023. The further reduction in unknown in 2022 to 2023 is largely due to improvements in how taxpayers are registered.

Figure 11 illustrates the following trends in Net Home VAT liability across annual turnover band. For the year ending March 2023:

  • traders with a turnover of greater than £10 million accounted for the largest amount of net Home VAT liability with £117 billion (75%).

  • traders with a turnover of up to and including the VAT registration threshold (currently set at £85,000), had a combined net Home VAT liability of -£3.06 billion.

Figure 11: Net Home VAT liability by annual turnover bands for the financial year ending March 2023.
Turnover Band Net Home VAT (£ billion)
Negative or £0 -3.1
£1 to threshold 0.0
> threshold to £150,000 2.3
> £150,000 to £300,000 4.4
> £300,000 to £500,000 3.7
> £500,000 to £1m 5.9
> £1m to £10m 26.3
> £10m 117.2

For the full dataset that accompanies Figure 11 go to Value Added Tax (VAT) tables 2022 to 2023.

6. Contacts and User Engagement

The VAT annual statistics are produced by the Indirect Taxes, Customs and Co-ordination team as part of the Excise duties, VAT and other indirect tax statistics collection on GOV.UK.

A consultation on the reduction and consolidation of HMRC statistics publications was held between 8 February 2021 and 12 March 2021 and the results have been published on GOV.UK.

HMRC welcomes user engagement to improve the departments National and Official Statistics. You can contact statistics producers via our feedback avenues.

For statistical enquiries, contact: revenuemonitoring@hmrc.gov.uk

For media enquiries, see the HMRC press office page on GOV.UK. Telephone: 03000 550 493

Back to top