Should I use the VAT Flat Rate Scheme as a tradesperson?

Should I use the VAT Flat Rate Scheme as a tradesperson? It depends on your materials spend. In 2026-27 a builder buying plenty can save on the 9.5% rate, but a labour-only trade often counts as a limited cost business, pays 16.5% and loses out. 9.5% for general building or construction services and 14.5% for labour-only building or construction, where materials are under 10% of turnover. A limited cost business pays 16.5% whatever its trade. A business whose spending on relevant goods, including VAT, is under 2% of its flat rate turnover, or over 2% but under £1,000 a year. Vehicle costs and fuel, food and drink, capital items and all services do not count as goods for this test. Not for work under the VAT reverse charge. VAT Notice 733 says the scheme cannot be used for supplies subject to a domestic reverse charge, which includes much construction work for VAT-registered contractors. Read the full answer, with every source, at rightotax.co.uk.