An Introduction to Registering for VAT

  • Price: £3.60
  • Published: March 2017
  • Type: Business Information Factsheet
  • Format: PDF

Value Added Tax (VAT) is a tax levied on the sales of goods and services. It is charged by traders who are registered for VAT, and is one of the Treasury's major sources of tax revenue. VAT must be charged at different rates according to the category of goods and services supplied, and some supplies are exempt from VAT altogether.

Traders are required to register for VAT when their 'taxable turnover' exceeds the VAT registration threshold, which is a figure that is fixed (and usually rises) in the Chancellor's Budget each spring. 'Taxable turnover' is the total value of the sales of goods and services that are liable for VAT (known as taxable supplies).

HM Revenue & Customs (HMRC) is responsible for ensuring that VAT-registered traders comply with the legislation relating to VAT and meet their responsibilities with regard to registering and accounting for VAT and paying the tax due.

The legislation covering VAT is complex and it is important to seek professional advice or contact HMRC for guidance to ensure compliance with current law.

This factsheet explains the VAT process and requirements for registration, how to calculate taxable turnover, the important issues to be aware of in relation to registering for VAT, and when and how to register. It also explains the process for de-registering for VAT and VAT inspections.

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