Who should register for VAT?

Overview

This section deals with the rules relating to Value-Added Tax (VAT) registration. It explains the following:

  • who must register for VAT
  • VAT thresholds
  • electing to register for VAT
  • when you can opt to tax lettings.

Generally, you must register for VAT if you are an accountable person.

A person carrying out only exempt activities or non taxable activities may not register for VAT. However, a person carrying on exempt activities or non taxable activities may be have to register for VAT in certain situations, for example;

Registration of a new business

If you have set up a business but have yet to supply taxable goods or services, you may reclaim VATon your start-up costs. However, to do so you are required to register for VAT.

This will enable you to obtain credit for VAT on purchases made before trading begins.

Traders whose turnover is below the VAT thresholds,  farmers and sea fishers are not generally obliged to register for VAT. They may, however, elect to register for VAT.

Check ‘Further guidance’ for registration information in respect of:

  • certain student unions
  • trade protection associations
  • gas and oil exploration companies.

Next: What are the VAT thresholds?