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How to do your VAT registration


You may need a VAT registration when your turnover from your activities exceeds the VAT registration threshold. This can happen if the total of the following exceeds the registration threshold:

  1. Your income from your activities (including income from providing services via 3CPS)

If you’re new to VAT this page walks you through the basics of the registration process. Expect the registration to take about 1 week.

Consult a tax advisor for more details on criteria and requirements that apply to you.

What your registration entails

VAT collected from providing services

The VAT you collect from selling your services (Cleaning services sold to Customers) is payable to HMRC with your VAT return.

VAT on business expenses

Besides collecting VAT, you may also be charged VAT on your business expenditure. For example fuel and car repairs. When you are VAT registered, you may be able to deduct this from the VAT you collected, but be sure to keep copies of your invoices.

HMRC has helpful sites, such as this one, to help you better understand what you can recover.

Criteria and Requirements

If your annual turnover, from all business activities, exceeds the threshold of £85,000, you are obliged to apply for a VAT registration. If your annual turnover is less than £85,000, you automatically fall under the small business regime, but you can voluntarily register for VAT if you wish.

When you expect your turnover to exceed the threshold, but be less than £150,000, you can apply for the Flat Rate Scheme. More, high level, information on the different types of VAT registrations will follow below.

If you want to know more on how and when to register, please visit this UK Government website, and this other register-if-youre-self-employed website which contains some useful information.

Speaking with a tax professional can also be helpful. Here are a few suggestions:

Other regimes

Small business regime

As mentioned above, you fall under the small business regime when your annual turnover is less than £85,000. This means that:

  • You should not be required to register for UK VAT

  • No UK VAT should fall due on the Cleaning services provided by you

  • No UK VAT should be due on the services provided by you to 3CPS

  • No UK VAT should be due on the Electronic Services received from 3CPS

  • You cannot reclaim input VAT incurred on business expenses

In conclusion the application of the small business regime should free you from a lot of VAT-obligations, like filing a periodic VAT return.

Flat Rate Scheme

When you are registered for VAT and your annual turnover is less than £150,000, you can apply to join the Flat Rate Scheme (you can apply either when you first register for VAT or at a later date).

Under the Flat Rate Scheme you pay a fixed rate of VAT to HMRC instead. 

Once you are registered and using the Flat Rate Scheme you are, amongst other things:

  • Required to charge 20% VAT on the Cleaning Services provided by you.

  • Not required to account for VAT on the services you provide to 3CPS, but you must make a reference to the “reverse charge” on your invoice

  • Not entitled to claim input VAT on your local business expenses, except for certain capital expenditures

  • Required to remit 10% of your VAT inclusive turnover to HMRC

The above is not a comprehensive list of your tax compliance requirements, but this system can save you a lot of time and effort, since the recording of VAT is much more simple. More information can be found on this website. We would also suggest speaking with a tax professional.

Other regime

Make sure you include your VAT registration status on your registration form page via whatsapp: 07851740180 . This helps to ensure that your invoices are generated correctly.

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