Discover the UK's VAT taxable turnover (VAT threshold) and, at your discretion, decide if your company has to register.
We understand that tax-related issues can be a little scary. It does not have to be that way, though. Learning key terms and procedures, such the VAT threshold, can enable prospective business owners who want to launch their enterprise in the UK more simply navigate the local tax system.
In this post, we'll examine the Value-Added Tax (VAT) in the UK and when your company is legally compelled to pay it. We will also discuss the benefits of registering for VAT as well as any difficulties it can present for your company.
Calculating the UK's VAT threshold
The VAT threshold determines how much money a business can make before having to register for VAT. The most recent threshold in the UK is that you must register for VAT if your business has a taxable turnover of more than £85,000 over the course of any consecutive 12-month period.
You still have the choice to register for VAT freely even if your company's yearly revenue is below the threshold.
Also take notice that, as of December 1, 2012, non-established taxable persons (NETPs) are no longer eligible for the standard UK registration threshold. If NETPs make taxable supplies in the UK, they must register for VAT.
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