What is the VAT Threshold?
VAT is applied to purchases of goods or services and other 'taxable supplies'.
As a VAT registered business you are required to charge VAT on your products and services.
A VAT registered business acts as a tax collector. Collecting VAT on its sales, and offsetting VAT on its purchases. The business then pays over the difference in VAT to HMRC.
Businesses are required to register for VAT when their revenue reaches the VAT registration threshold but can choose to voluntarily register early.
You can find out more about registering for VAT here - https://www.annetteandco.co.uk/when-do-i-have-to-register-for-vat/
The current VAT registration threshold is £85,000 over a rolling 12-month period.
The VAT Threshold
In the UK, the current VAT registration threshold is £85,000 over a rolling 12-month period.
The VAT taxable turnover refers to the sum of all goods and services sold that are not VAT exempt.
Additionally, a company must register for VAT if it is expected that the VAT taxable turnover exceeds £85,000 in the next 30 days.
This means that if your revenue reaches £85,000 over a rolling 12-month period you are required to register your business for VAT.
You can also choose to register for VAT early. This is called voluntary registration.
You can find out more about registering for VAT here - https://www.annetteandco.co.uk/when-do-i-have-to-register-for-vat/
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