Answers · UK 2025/26
Do I need to register for VAT?
Yes — UK businesses must register for VAT if VAT-taxable turnover in the previous 12 rolling months exceeds £90,000 (the 2025/26 threshold), or if you expect to cross it in the next 30 days. You can register voluntarily below the threshold to reclaim input VAT.
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The VAT registration threshold rose from £85,000 to £90,000 on 1 April 2024 and is held there for 2025/26. The test is rolling, not the tax year — check the last 12 months at the end of every month. Once turnover crosses £90,000 you have 30 days to register; effective date is the first day of the second month. Worked example: turnover hits £90,001 on 18 September 2025; you must register by 30 October 2025, effective 1 November 2025. Voluntary registration below the threshold makes sense if customers are mostly VAT-registered businesses (they reclaim the VAT you charge) and you have significant input VAT on supplies, software, equipment or stock. Standard rate is 20%, reduced 5% (domestic fuel, child car seats), zero-rated (most food, children's clothes, books) and exempt (insurance, education, healthcare). Flat Rate Scheme (FRS) simplifies admin — you pay a fixed % of gross turnover to HMRC, keep the difference, but cannot reclaim input VAT except on capital assets over £2,000. Limited-cost traders pay 16.5% on FRS. Deregister when turnover falls below £88,000. Returns are quarterly under Making Tax Digital and must be filed via approved software.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.