Quote from VATcal on 12/03/2024, 21:46

The threshold for mandatory VAT registration has increased from £85,000 to £90,000, effective April 1, 2024. This change aims to reduce administrative burdens and offer some financial relief to smaller companies.

What does this mean?

• Businesses with a taxable turnover below £90,000 are no longer required to register for VAT.
• This eliminates the need to comply with VAT regulations, such as charging VAT on taxable supplies and submitting VAT returns to HMRC.

Who benefits?

This increase in the threshold is particularly beneficial for:

• Small businesses and startups: Freelancers, sole traders, and small companies with turnover below £90,000 will be exempt from VAT registration.
• Businesses experiencing fluctuating turnover: Companies whose turnover occasionally dips below £90,000 can now avoid VAT registration.

Important points to remember:

• The change applies to the taxable turnover, which excludes VAT itself.
• Businesses exceeding the £90,000 threshold must still register for VAT and adhere to relevant regulations.
• Businesses already registered for VAT with a turnover below £90,000 may be eligible to deregister.