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Determine Whether and When to Register
You must register for VAT if your taxable turnover in any rolling 12-month period exceeds the current registration threshold, or if you expect it to exceed the threshold in the next 30 days. Check the current threshold on gov.uk as it is subject to change. Voluntary registration is permitted at any level of turnover and can allow you to reclaim input VAT on purchases — confirm the pros and cons with your accountant.
- Calculate your taxable turnover for the past 12 months
- Check whether any of your supplies are exempt (exempt supplies do not count toward the threshold)
- Decide between compulsory and voluntary registration in light of your customer base (B2B customers can recover VAT; B2C cannot)
Documents and Information Required
HMRC's online VAT registration service (on the Government Gateway) requires the following information. Have it ready before you begin the application to avoid saving and returning.
- Company name and Companies House registration number
- Registered office address and main trading address
- Bank account details for the company's business account
- Details of business activities and the SIC code
- Estimated taxable turnover for the next 12 months
- Date on which you became or expect to become liable to register
- Details of any existing VAT-registered businesses you have acquired (if a TOGC is involved)
Choosing a VAT Accounting Scheme
HMRC offers several accounting schemes that may suit different business types. The standard VAT accounting scheme requires you to account for VAT when you invoice. The Cash Accounting Scheme lets you account for VAT when you are paid — beneficial for businesses with long debtor days. The Flat Rate Scheme simplifies reporting for eligible smaller businesses but may not always be financially advantageous. Confirm which scheme suits your business with your accountant before selecting.
Making Tax Digital for VAT
All VAT-registered businesses must comply with Making Tax Digital (MTD) for VAT. This means keeping digital VAT records and submitting returns using MTD-compatible software. Ensure your accounting software is HMRC-recognised and linked to your Government Gateway account before your first return is due.
- Confirm your accounting software is MTD-compatible
- Link the software to your HMRC Government Gateway VAT account
- Set up a digital audit trail from purchase invoices through to VAT return submission
Post-Registration Obligations
Once registered, you must charge VAT on all applicable supplies, issue VAT invoices, submit returns on time (typically quarterly), and pay any VAT owed by the deadline. You must also notify HMRC of certain changes — including changes to your business address, bank account, or trading name — within 30 days. Penalties apply for late registration, late filing, and late payment.
Frequently asked questions
Can I backdate my VAT registration?
You can request an earlier registration date than the date of your application, for example if you want to reclaim VAT on pre-registration purchases (subject to HMRC rules). Speak to your accountant about whether backdating is beneficial in your situation.
What is a VAT invoice and what must it include?
A full VAT invoice must include your VAT registration number, a unique sequential invoice number, invoice date, supply date, your company name and address, the customer's name and address, a description of the goods or services, and the VAT rate and amount charged. Confirm the full legal requirements on gov.uk.
Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.