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VAT decision

Should I register for VAT?

The current UK VAT registration threshold is £90,000 of taxable turnover. If you are below it, voluntary registration can still help or hurt depending on your customers, costs and pricing.

When registration is compulsory

You generally need to register when taxable turnover goes over the current £90,000 threshold or you expect to go over it under the forward-looking rule. Special rules can apply.

When voluntary registration becomes a business decision

If most customers can reclaim VAT, adding VAT may create less pricing pain and you may recover VAT on eligible costs. If your customers are consumers or non-VAT-registered organisations, adding VAT can make your effective price more sensitive unless you absorb some of it.

What MoneyCue should eventually calculate

Enter customer mix, current prices, VAT-able costs and turnover, then compare staying outside VAT with registering and keeping price or margin constant.

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