VAT Registration

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Updated on : 24-Dec-2024   05:42 PM GMT | 4 min read

VAT Registration in UK

It is mandatory for every individual sole trader or a limited company to register for VAT in case the turnover exceeds £85000 in a financial year. You can also register for VAT voluntarily if you want to. Many individuals register for VAT voluntarily to improve the credibility of their business or to avail various other benefits like charging VAT on products or services or to reclaim it back. Voluntary VAT registration provides impression of a well-established company. It is beneficial for new businesses.

Advantages of VAT registration

The advantages of VAT registration are as follows –

1. It enhances the credibility of your business and increase trust among suppliers and customers.
2. VAT registered companies can easily reclaim VAT on purchases.
3. It allows you to clear goods from customs
4. It is very easy to register for VAT as the whole process is online.
5. It collects your payment from worldwide and transfers the same to any bank account in any currency worldwide.
6. Introduction of many new accounting softwares results in easy VAT return calculations and submission of VAT returns to HMRC before the deadline.
7. VAT registered companies can also enroll to various VAT accounting schemes as per their business requirement.
8. VAT registered companies can also reclaim VAT on goods up to 4 years and 6 months on services. You must have a valid VAT invoice in order to reclaim VAT.

When are VAT returns filed?

VAT returns are generally filed every quarter but it can be filed annually too in case you are availing annual VAT accounting scheme.