Registering for VAT online for your limited company

Registering for VAT online sorted might feel like a challenge. But fear not, we’re here to make it straightforward and stress-free!

Not every limited company needs to register for VAT, but understanding when and how to register can save you a lot of hassle further down the road. 

So, let’s break it down so you can get started with registering for VAT online.

Does my business need to be VAT registered?

Not every limited company needs to register for VAT.

You’ll only need to register if:

1. Your total taxable turnover for the past 12 months is over £90,000  – this is the VAT threshold for the 24/25 tax year
2. You expect your taxable turnover to go over £90,000 in the next 30 days
   
3. You’re based outside the UK and supply goods or services here, so you need to register regardless

How do I work out my taxable turnover?

Calculating your taxable turnover is pretty simple. You’ll just need to work out the total value of everything you sell that isn’t VAT-exempt.

This includes:

Here’s when you need to register for VAT and how to do it

So, you’re ready to tackle that VAT registration? Here’s when and how to get it done, based on your situation:

1. If you went over the VAT threshold last 12 months

If your total sales in the last 12 months were over £90,000, you have 30 days from the end of that month to register. Your VAT registration starts on the first day of the second month after you went over the limit.

Here’s an example: If your taxable turnover was over £90,000 on 20 March, you’ll need to register by 30 April. This means your date of registration will be 1 May. 

2. If you’re going to go over the threshold in the next 30 days 

If you expect your sales to go over £90,000 in the next 30 days, you’ll need to register by the end of those 30 days. Your registration date is the day you realised you’d go over the limit.

Here’s an example: On 5 June, you sign a contract that will push your sales over £90,000 by the end of the month. You’re going to be paid at the end of the month, so you’ll need to submit your VAT registration by then. Your registration date is 5 June.

What happens if I go over the threshold temporarily?

There’s no need to panic! if you’ve only gone over the limit temporarily, you can ask HMRC for a special exception.

Simply reach out to them through their VAT helpline and request the VAT1 form. You’ll need to show proof that your turnover will stay under £88,000 for the next year. HMRC will review your details and let you know if you get the exemption. If not, they’ll register you for VAT.

Everything you’ll need to register

To register for VAT, you’ll need to gather the following:

• Your company registration number
• Your business’s bank account details
• Your Unique Taxpayer Reference (UTR)
• Details of your annual turnover

You might also be asked about any recent Self Assessments, corporate tax returns and your PAYE details.

Follow these steps when registering for VAT online

You can register for VAT online on the HMRC website. Just log in to your Government Gateway account or create one.

But, you’ll need to register by post if you’re:

• Asking for a special exception because your turnover briefly went over the limit
• Joining the Agricultural Flat Rate Scheme
• Registering different parts of a big company separately
• A limited liability partnership registering as part of a VAT group
• An overseas partnership
• A local authority or council

Once you’ve got your information by post, you can then go online to register for a VAT online account.

Remember, you can’t include VAT on your invoices until you receive your VAT registration number. But you can increase your prices to cover the VAT you’ll eventually need to pay to HMRC.