Value Added Tax (VAT) ... For a “zero-rated good,” the government doesn't tax its sale but allows credits for the value-added tax paid on inputs. If a good or business is “exempt,” the government doesn't tax the sale of the good, but producers cannot claim a credit for the VAT they pay on inputs to produce it.

What is the difference between exempt and zero rated VAT?

Zero-rated items are goods on which the Government charge VAT but the rate is currently set to zero. ... Exempt items are goods on which no VAT is paid or charged, but which still need to be recorded on the VAT Return.

Do I charge VAT on zero rated delivery?

No charge for delivery. HMRC's guidance is clear. So if delivery is free, or the cost is built into the normal sales price, VAT is accounted for on the value of the goods based on the liability of the goods themselves. And this applies whether or not delivery is required under the contract.