VAT Registration Threshold: When Tradespeople Must Register (£90,000)
You must register for VAT once your taxable turnover goes over £90,000. The threshold sounds simple, but it is a rolling figure, not a tax-year one, and a busy few months or a single big job can take you over it before you notice. This guide explains how to check, the deadlines, and what changes once you are registered.
Checked against HMRC’s guidance on GOV.UK on 06/10/2026.
The two tests
You must register if either of these applies:
- Looking back: your total taxable turnover for the last 12 months goes over £90,000.
- Looking forward: you expect your taxable turnover to go over £90,000 in the next 30 days alone.
The 12 months are any 12 months in a row, not your tax year. Check the total at the end of every month.
What counts as taxable turnover
Taxable turnover is the total value of everything you sell that is not VAT exempt or outside the scope of VAT. It includes standard-rated, reduced-rated and zero-rated sales. For most electricians and tradespeople that is simply everything you invoice for work and materials.
Turnover means what you invoice, not your profit. A sole trader billing £8,000 a month passes £90,000 in their twelfth month, however much of it goes on materials.
The deadlines
If you went over in the last 12 months
Register within 30 days of the end of the month in which you went over. Your registration starts on the first day of the second month after you went over.
HMRC’s example: on 15 July your turnover for the last 12 months reaches £100,000, the first time it has gone over. You must register by 30 August, and your registration starts on 1 September.
If you are about to go over in the next 30 days
Register by the end of that 30-day period. Here the registration starts on the date you realised, not the date you go over.
HMRC’s example: on 1 May you agree a £100,000 contract, to be paid at the end of May. You must apply by 30 May, and your registration starts on 1 May.
If you register late
You must pay HMRC the VAT on everything you sold from the date you should have registered, even though you never charged your customers for it. You may also have to pay a penalty, depending on how much you owe and how late you are. Catching it in time is far cheaper than sorting it out afterwards.
Registering voluntarily
You can choose to register while your turnover is under £90,000. Some businesses do this to reclaim the VAT on what they buy. Whether it suits you depends on your customers: VAT-registered businesses can reclaim what you charge them, but homeowners cannot.
Leaving VAT
You can apply to cancel your registration if your taxable turnover falls below £88,000.
Once you are registered: Making Tax Digital for VAT
Every VAT-registered business now follows the Making Tax Digital for VAT rules. You no longer need to sign up yourself. In practice that means:
- keeping digital records of the VAT on what you sell and what you buy, with the date and value of each
- sending your VAT returns to HMRC through compatible software
- keeping your VAT records for at least 6 years
You must also tell HMRC within 30 days about certain changes to your business, or you may face a penalty.
How Mint Books helps
Mint Books keeps a running check of your turnover against the VAT threshold, so you can see it coming rather than finding out months late. Once you are registered, Mint Books keeps your VAT records digitally, works out your VAT return from your invoices and expenses, and sends it to HMRC under Making Tax Digital.
How VAT works in Mint Books · See plans and start a free trial
Sources
This guide is general information, not tax advice. If your situation is complicated, speak to an accountant.