Autumn Budget 2017: VAT registration threshold frozen

Businesses do not need to register for VAT until their taxable turnover exceeds £85,000 in any rolling 12-month period. Businesses can apply to deregister from VAT if turnover falls below £83,000.

Usually the VAT registration thresholds increase annually, but the Chancellor announced the current VAT registration and deregistration thresholds are to be frozen for a further two years from 1 April 2018.

The threshold for relevant acquisitions from other EU member states will also remain at £85,000 as long as the UK remains a member of the EU. Brexit is scheduled for 29 March 2019.

Smaller businesses are kept out of the VAT regime, but in response to proposals by the Office of Tax Simplification (OTS) that the high threshold in the UK distorts competition, this will be explored further by a government consultation.