OR another example:
Shopkeeper buys goods at C+C for �571.43 for which he has to pay another �100. VAT (17.5%)
He sells same goods for �1,714.29 and charges his customer �300. VAT.
SO customer has paid VAT �300. which goes to tax man.
Tax man gets �100. from C+C and �200 from shopkeeper.
If you are interested enough, you must remember that C+C have to pay VAT to their supplier, which they would deduct from shopkeepers payment before sending to tax man. And if shopkeeper is selling to another trader, then they in turn would charge more VAT, deducting the �300 they have already paid to shopkeeper before sending to tax man. In theory goods could pass through ten traders, each adding on tax at that stage but deducting tax paid at previous stage.