When do I have to register for VAT?

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Registering for VAT is something that most businesses have to do as they grow, some, whose businesses contract, may also be able to de-register for VAT.

Over the next few weeks we’re going to be taking a closer look at VAT, the different schemes that are available and what happens with VAT when you’re selling into other EU countries. Today we start off with the basics, when do you have to register for VAT?

A note of caution, the thresholds detailed below are correct at the time of publication but do change, generally on an annual basis.

When do UK Retailers have to register for UK VAT?

If your annual turnover exceeds (or you reasonably expect it to exceed) £83,000 in any rolling 12 month period than you have to register for VAT.

You also need to register for VAT if you’re importing goods worth more then £83,000 from the EU (even if you don’t resell them).

Once registered, you can’t deregister for VAT until your annual turnover drops below £81,000.

When do EU retailers selling into the UK have to register for UK VAT?

If you are an EU business selling to customers within the UK who aren’t registered for VAT (generally selling to consumers, small businesses not VAT registered, public bodies or charities) then you must register for UK VAT if your sales into the UK exceed £70,000 in any calendar year (1st January to 31st December).

You may still register for UK VAT, even if your sales are below £70,000, if you think it will help your business. You’ll need to inform the tax authority in your own country and then register with HMRC.

EU retailers selling goods subject to Excise Duty into the UK

If you’re based in the EU and sell goods subject to excise duty (e.g. alcohol, tobacco), then you must register for UK VAT and Excise Duty regardless of your level of sales.

When do retailers outside the EU have to register for UK VAT?

If you’re a retailer based outside the EU then usually you will have no obligation to register for UK VAT. However your customer may have to pay VAT and Import Duty when their purchases arrive in the UK.

Overseas retailers with stock in the UK

If you’re a retailer based outside the UK, but your stock is located in the UK (perhaps in a fulfilment house), then you must register for VAT immediately. There is no registration threshold so no matter how small your sales are you are obliged to register.

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