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Do I need to register for VAT? A plain-English guide
The VAT threshold, when you have to register, and when it might make sense to register before you have to.
You must register for VAT if your VAT-taxable turnover goes over the threshold in any rolling 12-month period. Note: that's a rolling 12 months, not your financial year.
How the rolling test works
At the end of every month, add up your taxable sales for the last 12 months. If the total is over the threshold, you have 30 days to register. Check the current threshold on GOV.UK, as it can change.
Should you register voluntarily?
- It can help if most of your customers are VAT-registered businesses, since they can reclaim the VAT you charge.
- You can reclaim VAT on your own business costs.
- It can be a disadvantage if you sell mainly to the public, as your prices effectively go up.
Not sure which side of the line you're on? Send us your last 12 months of sales and we'll tell you where you stand.
This article is general information, not advice for your specific situation. Rules and thresholds change, so check GOV.UK or speak to us before acting on it.