Facts checked on GOV.UK on . Tax rules change, so check the dates before you act on them.
The threshold
You must register for VAT if your total taxable turnover for the last 12 months goes over £90,000, or if you expect it to go over £90,000 in the next 30 days. Taxable turnover is the total value of everything you sell that is not VAT exempt or out of scope, including zero-rated and reduced-rated sales.
The two tests
- Looking back
- If your turnover for the last 12 months goes over £90,000, you must register within 30 days of the end of the month in which it happened. Your effective date of registration is the first day of the second month after you went over.
- Looking forward
- If you realise you will go over £90,000 in the next 30 days, you must register by the end of that 30-day period. Your effective date is the date you realised.
GOV.UK’s own example: on 15 July your turnover for the last 12 months is £100,000 for the first time. You must register by 30 August, and your effective date is 1 September.
Registering voluntarily
You can choose to register below £90,000. You do not have to register at all if you only sell VAT exempt or out of scope goods and services. Once registered, you owe HMRC any VAT from the date they register you.
After you register
You usually send a VAT Return every 3 months, and you must send one even if there is no VAT to pay or reclaim. Standard accounting suits many businesses, while flat rate, cash accounting and annual schemes exist for others. A short conversation before you register is cheaper than choosing the wrong one.
See how JT Accountancy handles VAT or request a call-back.
Sources: GOV.UK: register for VAT, GOV.UK: sending a VAT Return. This guide is general information published by Hull Accountant, not advice for your situation.