Check historical information about VAT thresholds if you think you should have been registered in previous tax years. Check what you need to do. To help us improve GOV. It will take only 2 minutes to fill in. Cookies on GOV. UK We use some essential cookies to make this website work. Not suitable if you anticipate regular VAT repayments. See GOV. VAT is calculated on actual cash receipts and payments rather than based on invoice dates.
What happens if I pay my VAT late? What records do I need to keep for VAT? When do I no longer need to be VAT registered?
Where can I get further information on VAT generally? What income is taxable? What tax allowances am I entitled to? What tax rates apply to me? How is my tax collected? What if I cannot pay my tax bill? Do I need to complete a tax return? Self Assessment: understanding the basics What is Simple Assessment? How do I claim tax back? How do I claim back tax if I complete a tax return? How do I claim back tax on savings income? How do I claim a marriage allowance refund?
How do I claim back tax on a payment protection insurance PPI pay-out? Should I use a tax refund company? What is National Insurance? How do I get a National Insurance number?
What are Adult Specified Childcare credits? What is Scottish income tax? What is devolution? Do I have to pay Scottish income tax? How does Scottish income tax work? What is Welsh income tax? Do I have to pay Welsh income tax? Do I have to join a pension scheme? There are advantages and disadvantages of voluntary registration, and the decision whether to register will depend on the circumstances of the individual business. To apply for permission not to register, you must write to HMRC and explain the circumstances.
HMRC will consider your application and confirm in writing if you are excepted from registration. You must register within 30 days of your turnover reaching the VAT threshold or of forming the expectation that it will be reached in the next 30 days. HMRC are also likely to apply a penalty, linked to how much tax you owe, how late the registration is and the circumstances of the case. You may be able to negotiate with HMRC to reduce or cancel a penalty in its entirety if there are genuine circumstances that prevented you from registering for VAT on time.
This will include the following common sources:. This will include supplies of goods or services that are outside the scope of UK VAT because of the place of supply rules.
This would include any sales of goods that take place outside the UK, for example buying goods in China and having them sent directly to a customer in the USA. The place of supply is outside the UK and the sale will not count towards your taxable turnover for VAT registration purposes.
Other non-business income is also excluded, such as disbursements incurred on behalf of a client, grants, or any income from employment. Businesses can also ignore one-off sales of capital assets so, for example, if a business sells a van that puts its turnover over the registration limit, the sale proceeds can be ignored. Charities can also ignore any income from donations, one-off fund raising events and educational and training courses that they undertake.
Businesses have to monitor their turnover on a rolling twelve-month basis, so at the end of each month you should check your turnover for the past twelve months to see if it has gone over the registration limit.
You then have 30 days to inform HMRC and are registered from the first day of the following month. A business exceeds the VAT registration threshold in September
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