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When Does a Small Business Have to Register for VAT?

By Trust Ledger Accounting. Figures checked against GOV.UK and last updated on 5 October 2026.

A UK business must register for VAT when its taxable turnover goes over £90,000 in any rolling 12-month period, or when it expects turnover to go over £90,000 in the next 30 days alone. You then have 30 days from the end of the month in which you crossed the threshold to register.

The two tests

Source: GOV.UK, register for VAT.

What counts as taxable turnover

Taxable turnover is the total value of everything you sell that is not exempt from VAT. It is measured over any rolling 12 months, not your financial year or the calendar year, so it needs checking every month as you get close.

Registering voluntarily

A business below the threshold can choose to register. It often makes sense when:

• Your customers are VAT-registered businesses, who can reclaim the VAT you charge
• You have significant costs that carry VAT, which you could then reclaim
• You expect to cross the threshold soon anyway

It is usually less attractive if you sell to the public, because your prices effectively rise by 20% or your margin falls.

After you register

• Charge VAT on your sales and show your VAT number on invoices
• Keep digital records and file returns through Making Tax Digital software
• File a return, usually every quarter, due 1 calendar month and 7 days after the period ends
• Consider a scheme. The Flat Rate Scheme is open to businesses with VAT-exclusive turnover of £150,000 or less, and Cash Accounting to those with taxable turnover of £1.35 million or less.

You can ask to de-register if taxable turnover falls below £88,000.

We prepare and submit VAT returns for £50 + VAT a quarter, and quarterly returns are included in our Standard and Complete packages.

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