How to register for VAT

Value Added Tax (VAT) is a consumption-based tax placed on certain goods and services and must be paid by companies exceeding a certain annual turnover threshold in the UK. If your company earns over this threshold, it has to register for VAT.

Once you have registered, you no longer pay VAT on your business expenses, as you can claim that VAT back when you submit a VAT return. You still have to pay the VAT at the time of purchase, but if you maintain perfect records and keep all your invoices and statements, you can submit them to HMRC with your VAT return and get reimbursed.

If you are selling goods and services to organisations and customers in the European Union (EU), you will need to register for VAT in the EU and the UK. This requires that you meet different VAT regulations and apply for VAT using other channels. The expectations for VAT registration in the EU are different from those in the UK.

Understanding VAT Registration

VAT registration is the process you need to follow to ensure that your company is correctly registered with HMRC so you can get a VAT number and access to the VAT online portal. The registration process aims to ensure that your company meets all the VAT requirements and that HMRC can provide you with support, accurate information, and access to relevant systems so you can manage your VAT returns and claims.

If you register for VAT, you can avoid future fines or penalties should you go over the VAT threshold, and you can cement your company’s reputation as many companies perceive VAT registration as a sign of stability, which really benefits smaller companies wanting to trade globally.

Did you know? The Making Tax Digital (MTD) for VAT process is now mandatory for all companies registered for VAT. If you registered for VAT after it was launched, you would have been automatically signed up to MTD unless any exemptions apply to your business. MTD requires that you keep accurate VAT records and use a compatible software solution to submit your VAT returns.

Digital Compliance and VAT Management in the EU

If you sell goods or services to customers in the EU and your sales exceed £8,818 (this is known as the distance selling threshold), then you need to pay VAT in the countries you send your goods and services to. You will then need to use the VAT One Stop Shop (OSS) scheme to register for VAT, or you will have to spend time registering for VAT in every country where you supply your services and exceed the distance threshold.

To register for VAT in the EU, you will need:

• Proof of VAT registration in the UK
• Your company certificate
• Your Articles of Association
• Proof of existence from the national company registrar
• Proof of your planned trade that includes contracts or invoices
• A letter of authority or power of attorney if you are using a tax representative

Every country in the EU has different documentation requirements and specific VAT expectations, so spend time seeking out the local VAT authority to ensure you have everything they need to register effectively. You can also use this helpful guide developed by the EU to unpack what you need to register for VAT in the region.

Did you know? The VAT OSS scheme can be used by companies selling goods from Northern Ireland to consumers in the EU. You can use this service to register for VAT in the EU and to remain compliant across all countries within the EU.

Preparing for VAT Registration

You should follow these steps to ensure you are eligible to register for VAT and have everything you need to make the process as smooth and easy as possible.

Assess Eligibility

When your company has a total VAT taxable turnover of more than £85,000 over the period of a year, then you are eligible to register for VAT. The same applies if you anticipate that your turnover will exceed that same amount – £85,000 – in the next 30 days.

However, you can still register for VAT if you earn below the threshold. The UK tax authority allows companies below the £85,000 annual turnover to register and experience the same benefits as those on or above the VAT registration threshold. This is known as voluntary registration.

It is also important to note that the HMRC still expects your business to register for VAT if it is not based in the UK and if it provides any goods or services to the UK or plans to in the next 30 days. You will also need to register if you recently purchased or took over a company that has already been VAT registered.

Exemptions: If your company sells items that are VAT exempt, then you do not have to register for VAT. You can find out more about which items are exempt from VAT here.

Did you know? The threshold to de-register for VAT is £83,000, and both the de-register and registration VAT threshold amounts are frozen until 31 March 2026.

Gather Required Documentation

Paperwork is part and parcel of running a business, and registering for VAT is no different. You will need to get the following items before you can start the process:

• Your Government Gateway User ID and password to log into the system and start the process. If you don’t have these, you will get them as you begin the HMRC VAT registration process. Start here.
• If you are a limited company, you’ll need your company name, paperwork that outlines your turnover and the type of business you do, your bank account details, your Unique Tax Reference (UTR) number, and your Company Registration Number.
• Also, have your Pay As You Earn (PAYE), Corporation Tax, and Self Assessment information and paperwork in hand.
• Suppose you are VAT registering as part of a partnership or as an individual. In that case, you’ll need your:
  • Date of birth
  • National Insurance (NI) number
  • A valid form of ID such as a passport or driving license
  • Your business turnover
  • Details about the work you do
  • Your bank account details
• Payslips, P60s, and Self Assessment returns
• All details of previously owned businesses you’ve had over the past two years and records of sale if you purchased your current business 

Note: You will also need to decide if you would like to handle your VAT registration yourself or if you’d like to use an agent.

Did you know? That the threshold to de-register for VAT is £83,000, and both the de-register and registration VAT threshold amounts are frozen until 31 March 2026.

Gather Required Documentation

Paperwork is part and parcel of running a business and registering for VAT is no different. You will need to get the following items before you can start the process:

• Your Government Gateway User ID and password will be needed to log into the system and start the process. If you don’t have these, you will get them as you begin the registration process. Start here.
• Decide if you would like to handle your VAT registration yourself or if you’d like to use an agent.
• If you are a limited company, you’ll need your company name, paperwork that outlines your turnover and the type of business you do, your bank account details, your Unique Tax Reference (UTR) number, and your Company Registration Number.
• Also, have your Pay As You Earn (PAYE), Corporation Tax, and Self Assessment information and paperwork to hand.
• If you are VAT registering as part of a partnership or as an individual, you’ll need your date of birth, National Insurance (NI) number, a valid form of ID such as a passport or driver’s licence, your business turnover, details about the type of work you do, your bank account details.
• Payslips, P60s and Self Assessment returns.
• All details of previously owned businesses you’ve had over the past two years and records of sale if you purchased your current business.

Organise Business Information

In addition to sourcing all the above documents, you should also put accurate record-keeping and VAT management systems in place. Ensure you have the right software to manage and submit your VAT returns and a digital record-keeping tool to store, manage and analyse your information to better manage your VAT returns.

Did you know? Most companies use a trusted VAT accounting system to ensure they submit the correct information to the tax authority. HMRC has a complete list of trusted service providers capable of making your VAT returns process much easier and smoother.

Step-by-Step Guide for VAT Registration

The steps below will talk you through VAT registration and the various considerations you need to make as you move through the process.

Step 1: Determine the VAT registration authority

If you are registering for VAT in the UK, then your VAT registration authority is HMRC. You can start the registration process here if you want to register online, or you can download this form to complete your VAT registration by post.

If you are registering for VAT in the rest of the world, then your VAT registration authority will be the one within the regions you are trading. For example, if you’re trading in Europe, then you would need to register with the specific VAT One Stop Shop (OSS) in the country where you’re doing business. You can register in any of the member states. The Irish VAT OSS is an accessible VAT registration resource, allowing you to follow the process in English. The paperwork requirements are almost identical to those required by HMRC.

Step 2: Complete the application form

Start by registering online with HMRC. You will need your Government Gateway User ID and Password to start the process. If you don’t have these, you can create a new sign-in as a new user. If you’ve lost or forgotten your password or Government Gateway User ID, you can follow a clear online walkthrough to help you get a new one. If you cannot register for VAT online and need to do so by post, follow these detailed instructions on how to register for VAT by post here.

Your registration process is step-by-step and straightforward. It will help you enter your business details while creating an online VAT account that will become one of your most invaluable resources. You can use this online account to pay your VAT, assess your status, file returns, and so much more. If you opted into using an agent to manage your VAT registration, they will do all this for you and simply let you know when you can expect to receive your VAT number and VAT online portal logins.

When you’re registering for VAT, you’ll be asked to choose a particular VAT accounting scheme, and this will be used by HMRC to calculate the amount of VAT you owe or how much it has to refund you. These accounting schemes are:

• Annual VAT accounting: lets you submit a VAT return once a year with quarterly payments based on estimates that are, in turn, based on previous returns.
• Flat-rate VAT accounting: allows some smaller companies to bypass VAT accounting and pay a percentage of their turnover.
• VAT cash accounting scheme: built on the basis that you have charged for VAT when making cash transactions and will then pay your VAT accordingly.
• Standard VAT accounting: asks that you submit a VAT return every month based on the VAT you have collected and paid, and then submit VAT payments to HMRC every three months.

Exemptions: Some exemption schemes have different VAT rules that apply to specific sectors or types of business. If this applies to you, you will have to register by post using a specific VAT1 form. Once you have followed the postal requirements and received your VAT number, you can then sign up for an online account.

Step 3: Submit supporting documents

The online portal makes it easy to add the relevant documents required by the tax authority as you move through the VAT registration process. If you are doing this by post, ensure you are providing the authority with every single item outlined in the VAT1 form. Both processes are clear on what paperwork and information you need to submit to complete the process and become VAT registered.

Await verification and approval

You can expect to receive your VAT Certificate of Registration and all your other important paperwork and information within around 30 days of your application. However, this is often provided much faster than that, with many companies receiving all their paperwork and details in just over a week.

Receive VAT registration number

Once you’ve received your VAT Certificate of Registration, you can use all the information on the certificate and in the provided paperwork sent to you by HMRC to log into your HMRC VAT portal, complete your registration, and start trading as a VAT-registered business.

When you have completed your VAT registration, you will receive a nine-digit VAT number that has to be included on every invoice you make and that will be used to track your VAT progress. You need to start charging VAT and reclaiming VAT from products or services you’ve bought since you registered once you receive your VAT number and login. You cannot include VAT on your invoices until you’ve received your VAT number.

VAT Compliance Post-Registration

Congratulations! You’re VAT registered. Now it’s time to ensure you remain VAT compliant by submitting your returns online and keeping up-to-date with your paperwork and payments. These steps will walk you through staying compliant once you’ve registered for VAT.

VAT invoicing and record-keeping

Registering for VAT does put pressure on you to maintain your paperwork properly. While this may feel boring and takes up time, it keeps your business on the straight and narrow. You’ll be immensely grateful if you ever discover a problem because finding information will be easy, and resolving it will be quick. Plus, you can then take advantage of intelligent technologies and solutions designed to make your VAT management much easier and more efficient.

Filing VAT returns

If you have registered for VAT, you must submit a VAT return. If you are not sure when you’re supposed to submit your VAT return, visit your online VAT account. It will tell you exactly what deadlines you have to work towards. VAT due date deadlines are non-negotiable. If you don’t submit on time, you could face penalties and fines that can cost your company money and potentially your reputation.

Did you know? We have a comprehensive walkthrough that takes you through everything you need to know about submitting a VAT return.

Compliance obligations

Spend time inside your VAT online portal so you know exactly what type of VAT reporting structure you have – monthly, quarterly, annually, specialised – and what deadlines you need to meet. Make these deadlines part and parcel of your business life so you are always ahead of the paperwork.

Work with an accountant or use a professional accounting software solution to manage your paperwork, filing, and VAT returns so the process is easy, accurate and up-to-date. 

VAT Registration Considerations for International Business

If you need to register for VAT in other countries, such as the EU, you must follow the clear VAT registration process for each country, providing the relevant paperwork and information. Like HMRC, most VAT authorities are online, making the process much easier to manage. Because trade with other countries is considered an export of goods and services, you must assess whether your goods are VAT exempt or need to include VAT.

You will need a VAT number for every country you operate in and you will need to ensure you are compliant across each country, meeting their VAT return deadlines and expectations on time. This level of compliance will likely take a lot of your time, so consider using a dedicated technology to help you better manage the process.

VAT Registration across the EU: A Comparative Analysis

The table below breaks down VAT registration and key considerations across different EU countries.

Key Differences in VAT Registration Processes

There are a few key differences between VAT registration in the UK and the EU.

• The VAT threshold is different. While EU thresholds vary from country to country, in the UK, it is £85,000 annual income, and for companies trading from the UK to the EU, the threshold is £8,818. Read our blog on VAT Threshold to the latest thresholds per country.
• The VAT number is different. Every EU country issues its own VAT number, so you will need a VAT number for each country in which you operate.
• You need to understand terms such as ‘place of supply’ or ‘country of supply’ and how these will affect your VAT charges and registration.
• You will charge your customers in EU countries 20% VAT on your products and services unless you go over the predetermined EU sales value threshold and then register for VAT in that country.
• The VAT Mini One Stop Shop (MOSS) helps companies providing digital services better manage their VAT across countries in the EU. You need to apply for the non-union MOSS scheme in your selected EU country if you are a UK supplier of digital services.
• There are different VAT implications for different categories, so you would need to know how VAT regulations in the EU implicate your VAT requirements.

Compliance Requirements Across the EU

You will be liable for serious penalties in the EU if you don’t ensure you register for VAT early on. If you register late, if you don’t register, or if you exceed the threshold over a certain period of time (this varies from country to country), then you can receive a fine. Some countries like Germany are quick to prosecute companies that don’t comply.

To remain compliant with VAT across the EU, you must learn all the rules and regulations for each country you operate in. This is the only way to ensure you operate within the regulations and don’t run the risk of fines or regulatory complexity. You must always apply, submit, pay, manage and provide your VAT on time to each tax authority within the EU and ensure that all these activities are handled and managed within the unique VAT invoicing and reporting expectations of each country.

Blue dot and VAT Registration

You may be concerned about how you’ll manage your VAT returns and admin now that you’ve registered for VAT, but don’t be – advanced solutions are available to help you make your VAT as seamless and easy as possible. Blue dot’s AI-driven tax compliance platform is a centralised, standardised and digitalised platform that provides you with superb visibility into your employee-driven expenses and provides deep analysis of your transactions for both VAT reclaim eligibility and assessment of taxable employee benefits.

Our VATBox solution makes it easy for companies to manage their VAT reporting across multiple jurisdictions, currencies and regulations. We leverage leading-edge AI and machine learning models to build an end-to-end, contextual, and transparent transactional story. This enables precise and automated VAT calculation and submission, ensuring your business can maximise VAT recovery opportunities while elevating compliance and minimising audit risk.

The Blue dot training series offers you insights and support from tax experts who understand the implications of VAT and how you can best manage it within your business, not only for VAT recovery but also for compliant Taxable Employee Benefit (TEB) reporting. 

Our unique technology-driven and AI-led approach is designed to unlock optimal efficiency and savings for your business while equipping you with audit-ready expense and tax management processes to ensure compliance across all entities and locations you do business.