Quick Overview

VAT (Value Added Tax) registration is required once a business's taxable turnover passes the current VAT registration threshold, and can also be done voluntarily below it. Once registered, a business charges VAT on eligible sales and can reclaim VAT on eligible purchases.

Who This Guide Is For

This guide is for businesses approaching the VAT threshold, or considering voluntary registration.

What You May Need

  • Records of your business's taxable turnover
  • Business bank details
  • Details of your business activities

Step-by-Step Process

  1. Check whether registration is required. This depends on your taxable turnover over a rolling 12-month period compared with the current threshold.
  2. Decide whether to register voluntarily if you're below the threshold but it would benefit your business.
  3. Register with HMRC, generally online, providing your business and turnover details.
  4. Set up VAT accounting in your bookkeeping so VAT is tracked correctly from your effective registration date.
  5. Start charging and reclaiming VAT from your effective date of registration.

Important Considerations

Once registered, a business must generally comply with Making Tax Digital requirements for VAT record-keeping and returns. The VAT threshold can change, so it's worth confirming the current figure with HMRC or your accountant.

This guide provides general information only and is not personalised tax advice.