HM Revenue & Customs (HMRC) has launched a new tool aimed at assisting businesses in understanding the implications of VAT registration.
When is VAT Registration Mandatory? VAT registration is compulsory if:
- Your total taxable turnover exceeds £90,000 over the previous 12 months.
- You anticipate your taxable turnover will exceed £90,000 in the next 30 days.
- You are based outside the UK and supply goods and services to the UK.
Taxable turnover refers to the total value of everything you sell, excluding items exempt from VAT.
Voluntary VAT Registration Even if your annual taxable turnover is below £90,000, you have the option to register for VAT voluntarily. This can be beneficial if the majority of your customers are VAT registered, as it allows you to claim VAT back on your purchases without increasing costs for your customers.
Features of the New HMRC Tool The newly released HMRC tool is designed to help you estimate the potential VAT owed or reclaimed by your business upon registration. It allows you to explore various 'what-if' scenarios, enabling you to compare different situations and their financial impact on your business.
To utilise the tool, please visit: Check what registering for VAT may mean for your business.
This tool is a valuable resource for any business considering VAT registration, providing clarity and aiding in informed decision-making. If you require further assistance or have questions regarding VAT registration, please do not hesitate to contact us. We are here to help.