If you start a business, one of the things you may need to consider is if and when you will need to register for VAT. To help you get started, read our quick introduction to VAT.
Registering for VAT
If your business turnover is more than £77,000, you need to register for VAT. (If you wish, you can also choose to register for VAT if your turnover is less.)
VAT is a tax that’s charged on many goods and services in the UK, and some that are imported from countries outside the European Union (EU), and brought into the UK from other EU countries.
When a company that is VAT registered sells goods or services to a customer they must charge VAT. A VAT registered company can also usually reclaim any VAT they pay.
The standard rate for VAT on goods and services it applies to is currently 20%.
Flat rate VAT
If your VAT turnover is less than £150,000 you can choose to join the flat rate VAT scheme instead.
If you use an accountant they can advise you if and when you need to register for VAT, and complete the registration for you.
Need to know more about VAT?
If you want (or need!) to find out more about VAT for business or freelance work, you’ll find lots of helpful advice in these articles:
- A quick guide to VAT for your business.
- What is flat rate VAT?
- Are you eligible for flat rate VAT?
- How does flat rate VAT work for freelancers?
- When you need to register for VAT.
- How to register for VAT.
Read more about business and finance!
Worried about tax? Don’t know what to call your company? You’ll find plenty of expert help here:
- Read our financial checklist for starting a business.
- Learn about deducting and paying National Insurance.
- How to choose a name for your Ltd company.
- Six things you need to do when you employ someone.
- Find out if you need to complete a tax return.
- Should you start a Ltd company or be self-employed?
- How HMRC have made it easier to claim self-employed expenses.
- Are you really self-employed? Take the IR35 test!