HMRC Vat Registration

You must register your business for VAT with HM Revenue and Customs (HMRC) if its VAT taxable turnover is more than £85,000.

When you register, you’ll be sent a VAT registration certificate. This confirms:

  • your VAT number
  • when to submit your first VAT Return and payment
  • your ‘effective date of registration’ – this depends on the date you went over the threshold, or is the date you asked to register if it was voluntary

You can register voluntarily if your turnover is less than £85,000, unless everything you sell is exempt. You’ll have certain responsibilities if you register for VAT.

Your VAT responsibilities

From your effective date of registration you must:

  • charge the right amount of VAT
  • pay any VAT due to HMRC
  • submit VAT Returns
  • keep VAT records and a VAT account

Most VAT registered businesses that earn over £85,000 must also follow the rules for ‘Making Tax Digital for VAT’.

While you wait

You cannot charge or show VAT on your invoices until you get your VAT number. However, you’ll still have to pay the VAT to HMRC for this period.

You should increase your prices to allow for this and tell your customers why. Once you’ve got your VAT number you can then reissue the invoices showing the VAT.

How to register

Register for VAT

Most businesses can register online – including partnerships and a group of companies registering under one VAT number.

By doing this you’ll register for VAT and create a VAT online account (sometimes known as a ‘Government Gateway account’). You need this to submit your VAT Returns to HM Revenue and Customs (HMRC).

Using an agent

You can appoint an accountant (or agent) to submit your VAT Returns and deal with HMRC on your behalf.

When you receive your VAT number from HMRC, you can sign up for a VAT online account (select option ‘VAT submit returns’).

When you cannot register online

You must register by post using VAT1 if:

  • you want to apply for a ‘registration exception’
  • you’re joining the Agricultural Flat Rate Scheme
  • you’re registering the divisions or business units of a body corporate under separate VAT numbers

Register by post using form:

  • VAT1A if you’re an EU business ‘distance selling’ to Northern Ireland
  • VAT1B if you import (‘acquire’) goods into Northern Ireland worth more than £85,000 from an EU country
  • VAT1C if you’re disposing of assets on which 8th or 13th Directive refunds have been claimed

When you receive your VAT number from HMRC, you can sign up for a VAT online account (select option ‘VAT submit returns’).

Getting your certificate

You should get a VAT registration certificate within 30 working days, though it can take longer.

It’s sent either:

  • to your VAT online account
  • by post – if an agent registers you or you cannot register online

What you need to know

You need to provide details like your turnover, business activity and bank details.

Your registration date is known as your ‘effective date of registration’. You’ll have to pay HMRC any VAT due from this date.

You do not need to authorise an agent to register you for VAT.

Cancel registration

You must cancel your registration if you’re no longer eligible to be VAT registered. For example:

  • you stop trading or making VAT taxable supplies
  • you join a VAT group

You must cancel within 30 days if you stop being eligible or you may be charged a penalty.

You can ask HM Revenue and Customs (HMRC) to cancel your registration if your VAT taxable turnover falls below the deregistration threshold of £83,000.

How to cancel

You can cancel your VAT registration online.

Cancel your registration

You can also fill in and send form VAT7 to cancel your VAT registration by post.

What happens next

It usually takes 3 weeks for HMRC to confirm your cancellation and the official cancellation date. This is either the date when the reason for your cancellation took effect (for example, when you stopped trading), or the date you asked to cancel if it’s voluntary.

HMRC will send confirmation to your VAT online account (or through the post if you do not apply online). From the date of cancellation you must stop charging VAT and keep your VAT records for 6 years.

HMRC will automatically re-register you if they realise you should not have cancelled. You’ll have to account for any VAT you should have paid in the meantime.

VAT after you cancel

You’ll have to submit a final VAT Return for the period up to and including the cancellation date. You must account for any stock and other assets you have on this date if:

  • you could reclaim VAT when you bought them
  • the total VAT due on these assets is over £1,000

Do not wait until you’ve received all your invoices before submitting your final return. You’ll still be able to reclaim VAT on anything you bought for your business while still registered once you get the invoices.

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