With it having been confirmed in the 2021 Spring Budget that the current VAT annual registration limit will remain frozen at £85,000 until at least 2024, we thought now might be a good time to recap the circumstances requiring a business to register for VAT.

When should I register for VAT?

When you register for VAT depends on whether you are registering voluntarily (VAT taxable turnover below £85,000) or are otherwise obliged to register.

Registration is compulsory if:

  • you expect your VAT taxable turnover to exceed the £85,000 threshold during the next 30-day period; or,
  • your business had a VAT taxable turnover exceeding £85,000 over the past 12 months.

If the former is true, you must have registered by the end of the 30-day period following the date you realised your turnover would exceed the threshold.

If the latter, you must register within 30 days of the end of the month when you went over the threshold – i.e. you exceeded the threshold on 8th July 2021, so you must have registered by 30th August 2021.

Your effective date of registration will differ depending on which of the above conditions you meet.

It is also worth bearing in mind that the types of goods or services you sell and, indeed, where you sell them might also give rise to the requirement to register.

Caroline comments: “When it comes to reviewing whether or not you have or could potentially exceed the £85,000 threshold, in view of the conditions for registration, this should be something you are checking monthly and not just at year-end.”

How can George Hay help?

We understand that VAT is complex and that the multifarious rules and regulations can be extremely difficult to navigate successfully – and that’s after you’ve successfully registered!

If you’re considering registering for VAT voluntarily, if you’re unsure whether you should be registering or if you know your turnover is going to exceed the threshold in the near future, we encourage you to pick up the phone and speak to one of our experts or fill in one of our online enquiry forms here.

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