The short answer: you must register for VAT when your taxable turnover for the last 12 months goes over £90,000. You can register earlier if it suits you. Once registered you charge VAT on your sales, reclaim it on most purchases, and send HMRC a VAT return, usually every quarter.
When you must register
You have to register when your total taxable turnover for the last 12 months goes over the VAT threshold, currently £90,000. You must register within 30 days of the end of the month in which you went over the threshold. Taxable turnover means what you sell, not your profit, so check it every month rather than at year end.
Registering voluntarily
You can also register below the threshold. Some businesses do this so they can reclaim VAT on their costs, or because customers expect a VAT number. It is worth talking it through first, because charging VAT can make you more expensive to customers who cannot reclaim it.
VAT returns and deadlines
A VAT return and the payment are generally due one calendar month and 7 days after the end of your VAT accounting period. All VAT-registered businesses should now be signed up for Making Tax Digital for VAT, which means your VAT information is kept and sent to HMRC digitally, using compatible software.
Schemes that can simplify things
- Flat Rate Scheme. You can join if your VAT turnover, excluding VAT, is £150,000 or less. You pay HMRC a fixed rate of your turnover and keep the difference between what you charge customers and what you pay HMRC. You generally cannot reclaim VAT on purchases, except on capital assets over £2,000.
- Cash Accounting Scheme. You can join if your VAT taxable turnover is £1.35 million or less. You pay VAT on your sales when your customers pay you, and reclaim VAT on purchases when you have paid your supplier. This can help if customers pay you late.
Whether a scheme saves you money depends on your costs and how you invoice, so check before joining.
Common VAT mistakes
- Forgetting to watch turnover and registering late
- Charging the wrong rate on a sale
- Reclaiming VAT without a valid invoice
- Filing or paying late
How we can help
We register you for VAT, keep your books up to date and file your VAT returns on time. See bookkeeping and VAT.
Sources: gov.uk, register for VAT, VAT returns, VAT Flat Rate Scheme, VAT Cash Accounting Scheme and Making Tax Digital for VAT, checked 25 September 2026. The threshold and scheme limits are set by the government and can change.
Common questions
What counts as taxable turnover?
It is the total value of the things you sell that are subject to VAT over the last 12 months, before costs. It is not your profit.
Can I go back if I register and later regret it?
In some cases you can deregister, for example if your turnover falls. Ask us before you make the decision.
Do I still need software if I use the Flat Rate Scheme?
Yes. All VAT-registered businesses should be signed up for Making Tax Digital for VAT, whichever scheme they use.
General information only, not personal advice. Tax rules, rates and thresholds change, so check gov.uk or speak to us about your own situation.