VAT registration information: When and the way to register for VAT – Sage Recommendation United Kingdom


108
1.4k shares, 108 points
VAT registration information: When and the way to register for VAT – Sage Recommendation United Kingdom

Wish to discover out all it’s worthwhile to find out about registering for Worth Added Tax (VAT)?

You’ve come to the suitable place.

It’s important to know VAT and what it means for what you are promoting, and be clear on the £85,000 VAT threshold. If VAT registration is on the playing cards for what you are promoting, you possibly can register for VAT on-line.

And as soon as what you are promoting is VAT registered, you’ll want to make use of Making Tax Digital to submit your VAT Returns.

Learn this text to find out about VAT, together with the way to register for VAT, and uncover the obtainable VAT schemes.

Right here’s what we cowl:

Who must register for VAT?

You need to register for VAT if the taxable turnover of what you are promoting has reached £85,000 (presently the VAT threshold) or extra over the previous 12 months, or it’s seemingly to take action within the coming yr.

Failing to register for VAT on-line or utilizing a VAT1 form when your turnover grows past £85,000 might end in a hefty fantastic from HMRC.

Are you able to voluntarily register for VAT beneath the edge?

Sure. You possibly can voluntarily register if what you are promoting has an annual taxable turnover of lower than £85,000.

What are the advantages of registering for VAT?

You could wish to register voluntarily to keep away from paying VAT on enterprise bills—you possibly can declare a refund once you file your VAT Return.

Say you’re opening a café or beginning a professional services company, and it’s worthwhile to purchase chairs, tables, computer systems and stationery, amongst different gadgets.

You possibly can reclaim the VAT factor of this expenditure from HMRC and pump that money into the enterprise earlier than ready for its turnover to exceed £85,000.

In addition to this sensible level, many companies desire their shoppers, suppliers and opponents to not know the way massive they’re.

For those who’re not VAT registered, they are going to know your turnover is lower than £85,000.

Among the many advantages of VAT registration is the picture of gravitas and professionalism that it develops to your firm.

Saying: “Am I VAT registered? Sure, in fact,” makes it clear you’re a “correct” enterprise within the eyes of many shoppers and suppliers.

Each quarter you could ship your VAT returns to HMRC (until you’re utilizing a special VAT scheme, such because the Annual Accounting VAT Scheme—see the ‘VAT schemes to select from’ part beneath).

Some companies discover this additional administration inconvenient, however you may like the truth that it forces you to commonly preserve your books updated.

How do I register for VAT?

There are two primary methods to register for VAT: Register online or use a VAT1 paper kind.

Fortunately, each approaches are easy if in case you have every thing that it’s worthwhile to register.

What do I have to register for VAT?

To finish your VAT registration, you’ll want:

  • What you are promoting contact particulars
  • Checking account particulars
  • Distinctive Tax Reference quantity
  • Particulars of your turnover and nature of enterprise.

Registering for VAT on-line

To register for VAT, you want a Authorities Gateway ID—a collection of 12 digits you employ alongside a password to entry the HMRC portal.

Your Authorities Gateway account is your VAT on-line account.

Registering for VAT on-line with no Authorities Gateway

  • Go to the Register for HMRC taxes web page, choose the suitable choice, after which click on the “subsequent” button to undergo the pages.
  • On the ultimate web page, choose “Create an account for me”.
  • Enter your particulars to create your Authorities Gateway ID. Maintain your person ID and password in a secure place as you’ll have to seek advice from them commonly.
  • On the register web page, enter your Authorities Gateway particulars.
  • As soon as logged in, scroll right down to the “Get one other tax, responsibility or scheme” part of the web page and click on the button beneath this.
  • Choose VAT and observe the ultimate steps to finish your VAT registration software.

Registering for VAT on-line if in case you have a Authorities Gateway

  • Go to the Register for HMRC taxes web page, choose the suitable choice, after which click on the “subsequent” button to undergo the pages.
  • Choose “I’ve an account – login” on the ultimate web page.
  • On the register web page, enter your Authorities Gateway particulars.
  • As soon as logged in, scroll right down to the “Get one other tax, responsibility or scheme” part of the web page and click on the button beneath this.
  • Choose VAT and observe the ultimate steps to finish your VAT registration software.

Registering for VAT utilizing the VAT1 kind

Most companies can register on-line.

Nevertheless, there are conditions the place you’ll have to register what you are promoting for VAT offline, similar to once you’re:

  • Making use of for a VAT registration exemption
  • Registering a number of enterprise models below totally different VAT numbers
  • Becoming a member of the Agricultural Flat Fee Scheme.

For those who can’t register on-line, you’ll have to fill out a VAT1 form and send it to HMRC in the post.

VAT schemes to select from

There are a number of totally different classes of VAT that you must examine earlier than you register for VAT.

For those who have an accountant or a enterprise adviser, you possibly can ask them for assist to turn into VAT registered and which scheme to decide on.

Listed here are some VAT schemes to contemplate:

Annual Accounting VAT Scheme

With the Annual Accounting VAT Scheme, you possibly can full one VAT Return a yr.

You’ll make advance VAT funds in the direction of your VAT primarily based in your final return or an estimated determine should you’re new to VAT.

VAT Flat Fee Scheme

The VAT Flat Rate Scheme is the place sure companies pay a share of their turnover as VAT—a extra simplified VAT Return course of.

As a substitute of deducting VAT on its inputs (in different phrases, what it buys), you deduct VAT on its outputs (what it sells).

It’s most related to corporations that spend a small quantity on items and uncooked supplies, similar to service suppliers.

VAT Money Accounting Scheme

With the VAT Money Accounting Scheme, you solely pay VAT when you’ve acquired cost out of your clients.

You reclaim the VAT paid on purchases when you’ve paid your suppliers.

What occurs once you register for VAT?

When you’ve registered for VAT:

  • The system will create a VAT on-line account for you, generally referred to as a Authorities Gateway account. That is the place you’ll obtain your VAT certificates. It takes as much as 30 days to get it.
  • The VAT certificates confirms your VAT quantity and tells you when you’ll need to submit your first VAT Return and cost.
  • You’re then able to submit your VAT Returns. You’ll often obtain automated reminders from VAT about when to do that.
  • Your VAT accounting begins from the date you had been obliged to register for VAT since you hit the £85,000 threshold or the time you determined to register voluntarily.

FAQs on registering for VAT

How do I submit my VAT Return?

For those who’ve registered or will register for VAT, it’s worthwhile to submit your VAT Returns with Making Tax Digital (MTD).

You possibly can get up to speed with MTD with our checklist.

Can I register for VAT with no turnover?

You possibly can register for VAT voluntarily earlier than turnover creates an obligation to register.

You could wish to do that to recuperate VAT in start-up prices.

How lengthy does it take to register for VAT?

It is best to get a VAT registration certificates inside 30 working days, although it may well take longer.

Do I want a Authorities Gateway account to register for VAT?

Sure, your Authorities Gateway account is your VAT on-line account should you register on-line.

You don’t want an internet account if you’re registering by put up.

How do you register for VAT if you end up self-employed?

You need to register for VAT as outlined on this article in case your turnover reaches over £85,000 in a yr.

How do you register for VAT as a sole dealer?

Similar as should you’re self-employed.

You need to register for VAT as outlined on this article in case your turnover reaches over £85,000 in a yr.

How a lot does it value to register for VAT?

There is no such thing as a VAT registration value.

That doesn’t rely what chances are you’ll have to pay for an accountant in the event that they full your VAT Return.

Editor’s notice: This text was first revealed in November 2018 and has been up to date for relevance.


Like it? Share with your friends!

108
1.4k shares, 108 points
ccxenx

0 Comments

Your email address will not be published.