Article Summary
This guidance note provides information for tax professionals about voluntary VAT registration in the UK. It explains when voluntary registration is possible, reasons it may be beneficial, and practical considerations. The note clarifies that voluntary registration is available when a business makes, or intends to make, supplies allowing them to reclaim VAT on costs. This includes UK and overseas supplies which would be taxable in the UK. It highlights key reasons to register voluntarily - to generate VAT repayments, reduce risks of penalties for late registration, or because sales are to VAT registered customers. Practical points covered include considering regularity of repayments, extra administration costs, and reduced margins from sales to non-VAT customers. The note explains the process of retrospective registration, limited to 4 years. Overall it aims to help tax professionals advise clients when voluntary VAT registration may be advantageous, and factors to consider.