VAT Registration Threshold 2026: The Key Number
The Key Number: £90,000
For the 2026/27 tax year, you must register for VAT if your VAT taxable turnover exceeds £90,000 in any rolling 12-month period.
This is your total sales of goods and services that are not VAT-exempt — including zero-rated supplies. It's your turnover, not your profit.
How the Rolling Period Works
At the end of every month, add up your taxable turnover for the previous 12 months. If the total exceeds £90,000, you must notify HMRC within 30 days.
You must also register if you expect your turnover to exceed £90,000 in the next 30 days alone — this catches businesses landing a single large contract.
The Deregistration Threshold
The deregistration threshold is £88,000. If your turnover drops below this and you expect it to stay below, you can apply to deregister.
The gap between the two thresholds (£90,000 for registration, £88,000 for deregistration) prevents businesses from constantly registering and deregistering when their turnover hovers around the limit.
What Counts Towards the Threshold?
- Standard-rated sales (20%): Yes
- Reduced-rate sales (5%): Yes
- Zero-rated sales (0%): Yes
- Exempt sales: No
- Sales of capital assets: Generally excluded
Don't Get Caught Out
The most common mistake is not monitoring your rolling 12-month turnover frequently enough. With Accounted, Penny tracks your cumulative turnover automatically and warns you when you're approaching the threshold.
Stay ahead of the VAT threshold. Start your free trial with Accounted and never be caught off guard.
Tax & Compliance Specialists
Our tax specialists have decades of combined experience in UK sole trader and small business taxation, MTD compliance, and HMRC submissions. All content is reviewed against current HMRC guidance before publication and updated quarterly to reflect legislative changes.
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