We specialise in helping businesses that require VAT registration. When your business reaches the VAT threshold, we can assist you in becoming registered and understanding what your next actions must be.
What are the VAT registration thresholds?
Any business that has a VAT taxable turnover of more than £85,000 must be registered to pay VAT. There are certain goods and services that are exempt from VAT, but an accountant can help you understand whether you are over the limit. You are expected to monitor your turnover closely if you are close to the £85,000 amount, because the onus is on you to then make sure you are registered.
You must register when either your accounts for the past year show a turnover of £85,000 or more, or as soon as you realise your next 30 day period will take you over the threshold. You have those 30 days to register, and your effective date is the day you realised – so if you recognise on 1st June that you will go over that threshold, you have until 30th June to register, but your effective registered date will be 1st June.
You can then only deregister for VAT if your turnover falls below £83,000. The £2,000 leeway is designed to protect from small fluctuations that would see you frequently registering and deregistering if your turnover was around that level.
How to register for VAT?
Most businesses can register for VAT with HMRC online. If you wish to use our services, to make sure that your VAT returns in future are accurate and you are always getting any rebate that you are due, you can appoint us as an agent to deal with HMRC on your behalf.
Once you have registered, you will usually receive your VAT certificate within 30 working days. You cannot raise your prices with customers to charge VAT until you have been issued your certificate.
How to deregister for VAT?
If your turnover falls below £83,000, you can ask HMRC to cancel your VAT registration. You also need to deregister within 30 days if you stop trading or you join a VAT group. You do not have to deregister if your threshold falls below £83,000 and you can continue to charge and pay VAT if you wish.
Please get in touch if you would like assistance with your VAT registration and managing your VAT returns.