VAT is a tax on transactions rather than on profit. Depending on the type of transaction (i.e. different goods and services), different rates of VAT will apply. Businesses registered for Vat can claim back VAT incurred on their inputs (i.e. phone, electricity, material purchases etc.) and will pay VAT on their sales at the appropriate rate of VAT depending on the type of Goods or Services they supply. For more information on the rates of Vat applicable please click on the link here