Part of our complete guide to VAT & MTD.
The number: £90,000
As of 2026/27, the VAT registration threshold is £90,000. If your taxable turnover goes over that figure, registration stops being optional. For the full detail on schemes, voluntary registration and the registration process itself, see our main VAT registration guide, this page focuses specifically on how the threshold is measured, which is where most people go wrong.
It's a rolling 12-month figure, not your accounts year
This is the single most misunderstood part of VAT registration. The £90,000 test isn't based on your financial year or tax year, it's based on any rolling 12-month period, checked continuously. That means your turnover for the 12 months ending in June could trigger registration even if your turnover for the 12 months ending at your actual year-end doesn't.
Key point: You must check this every month, not once a year. A business that does most of its trade in a short, busy season can cross the threshold mid-year and not realise until their annual accounts are prepared, by which point they may already be months late registering.
The "next 30 days" rule
There's a second, separate trigger that catches people out even more. If you expect your turnover in the next 30 days alone to exceed £90,000, you must register immediately, you don't wait for the rolling 12-month total to actually cross it. This typically applies to a business that's just won a single large contract or had a sudden spike in sales.
What counts toward the £90,000
- Standard-rated, reduced-rated, and zero-rated sales all count
- VAT-exempt sales (financial services, insurance, some education) do not count
- One-off sales of business capital assets do not count
- Income entirely outside the scope of VAT does not count
Monitoring it properly
The practical fix is simple: check your rolling 12-month taxable turnover every month, not just at year-end. Most accounting software can be set up to flag this automatically. If you're within striking distance of £90,000, even a strong month can tip you over without warning.
Not sure where you stand? Book a free consultation and we'll check your rolling turnover properly, and register you immediately if you've already crossed the line.
Frequently asked questions
What exactly is the VAT registration threshold?
£90,000 of taxable turnover in any rolling 12-month period, as of 2026/27. It is not tied to your accounting year end, you must check on a continuous rolling basis.
How often should I check my turnover against the threshold?
Monthly is sensible for most growing businesses, since the rolling 12-month window moves every month. Checking only once a year at your accounts date can mean you miss the point you actually crossed it.
What if I expect to cross the threshold soon?
There is also a "future turnover" test: if you expect to exceed £90,000 in the next 30 days alone, you must register immediately, you do not need to wait for the rolling 12-month total to actually cross it.
Is it the same threshold for every type of business?
Yes, the £90,000 threshold applies regardless of legal structure, sole trader, partnership or limited company, it is based on the taxable turnover of the business, not its size or form.