Historically, the UK’s high VAT registration threshold has proven beneficial to smaller businesses, allowing them to avoid the reporting and deadlines associated with VAT. However, there is now a view that, rather than furthering the UK economy, the threshold is stopping small businesses from growing into larger, profitable businesses.
The government has therefore issued a “call for evidence” to:
- Explore the effect of the VAT threshold on business growth.
- Look at why businesses may manage their turnover to avoid registering
- Consider policy solutions
All businesses affected by the threshold are invited to express their opinions on whether the £85,000 VAT registration threshold is helping them or creating a burden.
The call for evidence closes on 5 June 2018.