Do you need to register for VAT
Yes, if yearly turnover is £85K or more.
Optional if yearly turnover is less than £85K.
(You can’t claim VAT on expenses if you don’t register.)
Adding VAT to your prices
Old price x 1.2 = VAT inclusive price (for 20% VAT). Old price x 1.05 = VAT inclusive price (for 5% VAT)
(No price change for 0% VAT)
Keep a running tally of the VAT you’ve collected on sales.
Do the same for the VAT you’ve paid on purchases.
You’ll use these numbers to figure out your VAT bill or refund at step 6.
*You will most likely collect more than you pay.
Think of VAT as money you’re collecting for HMRC. Treat it as their money and you won’t get caught short.
VAT due dates
Most businesses file quarterly. The due dates are shown in your online VAT account.