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VAT returns & Making Tax Digital

VAT Registration Threshold Guidance

If your sales are growing, it can be hard to tell when VAT registration becomes mandatory. This service gives you clear guidance on the VAT registration threshold, how the rolling 12-month test works, and what practical steps to take so you stay compliant and can plan ahead.

More information

What this service covers

You get straightforward, situation-specific guidance so you can make a confident decision and act on time. Support typically includes:

  • Checking whether you are close to, at, or over the VAT registration threshold using the rolling 12-month method
  • Explaining the difference between past 12 months turnover and expected turnover in the next 30 days
  • Identifying which income counts as taxable turnover and what can be excluded
  • Discussing the risks of late registration and how to reduce penalties and disruption
  • Planning the timing of registration where you have choices, and understanding cashflow impact
  • Clarifying which VAT scheme might fit your setup (where relevant) and what records you will need

When this is most useful

This guidance is ideal if you are:

  • Growing quickly and worried you might cross the threshold without noticing
  • Invoicing irregularly, working on large projects, or experiencing seasonal spikes
  • Running an owner-managed limited company or a sole trader business and unsure what counts towards turnover
  • Considering voluntary VAT registration and want to understand the pros and cons
  • Buying in significant costs and want to know whether VAT registration could help you recover VAT

How the guidance is delivered

We start by understanding how you trade, what you sell, and how you invoice. We then review your turnover pattern against the VAT threshold rules, explain the outcome in plain English, and confirm the key dates and actions.

If registration is needed, you will leave with a clear plan: what to prepare, what to tell customers, and what changes to expect in your pricing and bookkeeping.

What happens after

If you decide to register, the next step is to put simple processes in place to keep VAT under control. This can include setting up your accounting software correctly, choosing a VAT scheme (if suitable), and establishing a routine for VAT return deadlines so you stay compliant going forward.

Frequently Asked Questions

How do I know if I have exceeded the VAT threshold?
VAT uses a rolling 12-month test, not a calendar year. We help you check your taxable turnover month by month and confirm whether you have crossed the limit and when the obligation started.
What income counts towards the VAT registration threshold?
Generally, taxable sales count, not every receipt of money. We will clarify what is standard rated, reduced rated, zero rated, and outside the scope for your specific activities.
Can I register for VAT voluntarily before hitting the threshold?
Yes, you can register voluntarily in many cases. We will talk through whether it makes sense based on your clients, pricing, costs, and the extra admin involved.
What happens if I register late?
You may have to pay VAT backdated to the required registration date, and penalties can apply. We guide you on next steps quickly and help you minimise disruption and unexpected costs.
Will VAT registration mean I have to raise my prices?
Not always, but it can affect your margin if you cannot pass VAT on to customers. We will explain the likely impact and options so you can plan pricing and cashflow realistically.

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Complete your experience with these services

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  • VAT Complexity Support (Rates & Restrictions)
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  • VAT Digital Record Keeping Setup
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  • VAT Scheme Selection Advice
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  • VAT Return Preparation & Filing
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