Question 1

What is the VAT registration threshold for 2025/26?

Accepted Answer

The VAT registration threshold for 2025/26 is £90,000. If your taxable turnover exceeds this amount in any rolling 12-month period, you must register for VAT within 30 days. You can also register voluntarily if you're below the threshold.

Question 2

When do I need to register for VAT?

Accepted Answer

You must register if your VAT-taxable turnover exceeded £90,000 in the last 12 months (the 'backward look'), or if you expect it to exceed £90,000 in the next 30 days alone (the 'forward look'). Late registration can result in penalties from HMRC.

Question 3

What is the VAT Flat Rate Scheme?

Accepted Answer

The Flat Rate Scheme lets you pay a fixed percentage of your VAT-inclusive turnover to HMRC instead of calculating the difference between output and input VAT. The percentage varies by trade (typically 9.5% to 14.5%). It simplifies your VAT return and can save money if you have few VAT-able expenses.

Question 4

Should I use the Flat Rate or Standard VAT scheme?

Accepted Answer

The Flat Rate Scheme suits businesses with low expenses (like consultants and freelancers). If you buy lots of goods or materials with VAT on them, the Standard Scheme is usually better because you can reclaim all input VAT. Run the numbers through our calculator to compare both options.

VAT Registration Threshold Calculator 2025/26

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