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Tax30-60 minutesEasy

How to Register for VAT in the UK

Step-by-step guide to VAT registration for your limited company. Includes when you must register and how to complete the process.

What You'll Need

  • Company UTR (Unique Taxpayer Reference)
  • Government Gateway login
  • Bank account details
  • Estimated annual turnover
  • Business activity description

Step-by-Step Guide

1

Determine if you must register

You must register if your taxable turnover exceeds £90,000 in any 12-month period, or you expect to exceed it in the next 30 days.

Tips
  • •Taxable turnover means VAT-able sales
  • •Monitor your rolling 12-month total
  • •You can voluntarily register below threshold
2

Decide on your VAT scheme

Choose between Standard VAT accounting, Flat Rate Scheme (simplified), Cash Accounting, or Annual Accounting based on your business.

Tips
  • •Flat Rate suits businesses with few purchases
  • •Cash Accounting helps if customers pay slowly
  • •You can change schemes later
3

Gather required information

You'll need your company details, bank account information, estimated turnover, and business activity description.

Tips
  • •Have your UTR ready
  • •Know your expected turnover for next 12 months
  • •Estimate your EU sales if applicable
4

Register online with HMRC

Use the Government Gateway to register for VAT. Log in with your company's Government Gateway credentials.

Tips
  • •Create business tax account if you haven't
  • •Registration typically takes 7-14 days
  • •Effective date can be backdated
5

Receive your VAT certificate

HMRC will send your VAT registration certificate with your VAT number. This typically arrives within 30 days.

Tips
  • •Don't charge VAT until you have your number
  • •You can backdate invoices once registered
  • •Add VAT number to invoices and website
6

Set up MTD-compatible software

Making Tax Digital requires you to use compatible software to file VAT returns. AccountsOS files MTD VAT returns straight to HMRC and is on HMRC's own list of software compatible with Making Tax Digital for VAT: https://www.tax.service.gov.uk/making-tax-digital-software (search AccountsOS).

Tips
  • •You cannot file VAT returns through HMRC website
  • •Software must connect via API
  • •Keep digital records from day one
7

Start charging and reclaiming VAT

Add 20% VAT to your invoices for standard-rated supplies. Keep VAT receipts for purchases to reclaim.

Tips
  • •VAT invoice must show VAT separately
  • •Some supplies are zero-rated or exempt
  • •You can reclaim VAT on pre-registration purchases
8

File your first VAT return

VAT returns are usually quarterly. Your first return may be a different length to align with quarterly dates.

Tips
  • •Due 1 month and 7 days after period end
  • •File and pay through MTD software
  • •Set up direct debit for easier payment

Common Mistakes to Avoid

Waiting too long to register (you're liable from threshold date)

Charging VAT before receiving VAT number

Not using MTD-compatible software

Forgetting to reclaim VAT on pre-registration purchases

Frequently Asked Questions

What is the current VAT registration threshold in the UK?

The VAT registration threshold is £90,000 as of April 2024. If your taxable turnover exceeds this in any rolling 12-month period, you must register for VAT within 30 days. You can also register voluntarily below this threshold.

Can I register for VAT before reaching the threshold?

Yes, voluntary VAT registration is allowed at any turnover level. This can be beneficial if your customers are VAT-registered businesses, as they can reclaim the VAT you charge. It also lets you reclaim VAT on your business purchases from day one.

How long does HMRC take to process a VAT registration?

HMRC typically processes VAT registrations within 30 working days, though it can take up to 40 days during busy periods. You will receive your VAT registration certificate with your VAT number by post once approved.

What VAT scheme should I choose for my small business?

The Flat Rate Scheme is popular for small businesses with turnover under £150,000, as it simplifies record-keeping by applying a fixed percentage to your gross turnover. The Standard scheme is better if you have significant VAT-able expenses to reclaim.

Do I charge VAT from the date I register or the date I receive my number?

You must charge VAT from your effective date of registration, which is stated on your VAT certificate. This may be before you receive your VAT number. You can issue invoices showing your VAT number retrospectively once you receive it.

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