To become VAT registered in the UK you must own a business with £85,000 or more VAT taxable turnover, or operate a distance selling of services and goods with VAT taxable of £70,000, or own goods worth more than £86,000 form EU and expect to exceed £83,000 in a 30-day period. Then you can get registered with Revenue and Customs (HMRC) for your VAT number.
There are several businesses that are prohibited from VAT registration, such businesses are sales of services or goods are termed VAT exempted by HMRC, such education, insurance, charities and so on. Therefore before you apply for VAT registration, ensure that your services or goods sale are listed as VAT taxable.
The major ways to get registered with HMRC for VAT number and right to add VAT charges to sales of services or goods are:
- Self Registration
Individuals can register for VAT on their own when they meet the HMRC conditions for registration. First, you will have to gather all required document for registration such as
- National Insurance (NI) number
- Certificate of incorporation and incorporation details
- Tax identifier i.e. Unique Taxpayer’s reference (UTR) number
- Information about all business activity, associated businesses, for the period of 2 years, before your VAT registration application date.
- Turnover and business bank accounts details
After submitting all required documents directly to HMRC, you then wait for few days for your documents to be reviewed. If you meet the VAT registration requirement and HMRC approves your registration, VAT number will be issued to you by HMRC, followed by VAT confirmation of reporting cycle. Once you have all your VAT number and reporting cycle ready, then you can continue to open an online account also called government gateway account for online operations.
- Registration Using an Agent
The stress of trying to do your VAT registration all by yourself can be overwhelming. There are experienced agents who will help you handle all document processes with just a worthy token. Using an agent for VAT registration is the easiest way to go about becoming VAT registered in the UK. An agent will perform all transaction with HRMC on your behalf till your VAT request is approved and VAT number and reporting cycle is issued. The agent will also handle opening of an online account. The agents know how well to go about registration of more than one business under one VAT number.
You start paying VAT charges to HRMC form the day your request is approved. The VAT approval date is regarded as your effective-date-of-registration.
- Register by post using form
When online registration seems not to be working smoothly for you, you can get the required forms for your VAT type, fill it out accordingly and post completed forms to HMRC. Available VAT form types in the UK are:
- Form VAT1A if your business type involves EU distance selling of goods and services to the UK
- Form VAT1B if your business involves the importation of goods worth £85,000 or more from any EU country into the UK.
- Form VAT1C if you are selling off assets that have directive refunds with 8th or 13th refund claims
Getting your certificate
The waiting period for a reply from HMRC about your application status and certificate issue is within 14 working days. In some cases, it may take longer. Your VAT certificated can either be posted to your online VAT account or sent by post mail to you. Agent and people who could not register online usually get the certificate by post.
Once you have your VAT certificate, you can boldly say that you are now Vat registered in UK and can start adding VAT charges to sales.