The VAT threshold refers to the minimum annual turnover that businesses must reach before they are required to register for value-added tax (VAT). As of 2019-2024, the UK VAT registration threshold is set at £85,000, which has remained unchanged since 2017. However, prior VAT thresholds were as follows: 2014–2015 – £81,000, 2015–2016 – £82,000, and 2016–2018 – £83,000. Once a business’s turnover exceeds the VAT threshold, it has 30 days to register for VAT with HMRC and bear added responsibilities such as charging and paying VAT, submitting VAT returns, and keeping VAT accounts and records.
It is vital to register for VAT once a business reaches the threshold to avoid legal penalties. Even if your small business has exceeded the VAT threshold momentarily, it is a legal requirement to register for VAT within 30 days of crossing this line. Keep a close eye on your business turnover on a regular basis, regardless of the 12-month period, as the VAT threshold is measured on turnover. An exception can be applied for not registering for VAT if your turnover exceeds the threshold temporarily due to a one-off event, or there’s no likelihood of it happening again in the near future.
If your business turnover is less than £85,000, it is still possible to register for VAT voluntarily. The benefits include becoming more cost-effective for VAT-registered customers, who could claim VAT back on purchases, and claiming VAT on the costs of setting up. To reduce VAT liability and smooth out payments, consider joining schemes such as the Flat Rate Scheme, VAT Cash Accounting Scheme, or Annual Accounting Scheme VAT.
Staying under the VAT threshold can be difficult for tradespeople, but splitting your business into separate entities offering distinct services is one solution. Finally, being aware of zero-VAT rated goods and import duties is crucial.
![Certainly! Here’s a rewritten version of a self-employed invoice template suitable for a small business in the UK, keeping the original meaning intact:
Self-Employed Invoice Template
Your Business Name
Your Address
City, Postcode
Email: your.email@example.com
Phone: 01234 567890
Invoice Number: [Invoice Number]
Invoice Date: [Date]
Due Date: [Due Date]
Bill To:
Client’s Name
Client’s Address
City, Postcode
Description of Services Provided:
Item/Service
Hours/Quantity
Rate (£)
Total (£)
[Service Description]
[Hours/Qty]
[Rate]
[Total]
Subtotal:
[Subtotal]
VAT (if applicable):
[VAT Total]
Total Amount Due:
[Total Due]
Payment Instructions:
Please make payment via bank transfer to the following account:
Account Name: [Your Account Name]
Sort Code: [Your Sort Code]
Account Number: [Your Account Number]
For any questions regarding this invoice, please contact me at the details above.
Thank you for your business!
Feel free to fill in the specific sections or adjust any parts according to your needs!](https://www.cloverbusiness.co.uk/wp-content/uploads/2025/05/leadership-7882178_960_720-120x86.jpg "<p>Certainly! Here’s a rewritten version of a self-employed invoice template suitable for a small business in the UK, keeping the original meaning intact:</p>
<hr />
<p><strong>Self-Employed Invoice Template</strong></p>
<p><strong>Your Business Name</strong><br />
Your Address<br />
City, Postcode<br />
Email: your.email@example.com<br />
Phone: 01234 567890 </p>
<p><strong>Invoice Number:</strong> [Invoice Number]<br />
<strong>Invoice Date:</strong> [Date]<br />
<strong>Due Date:</strong> [Due Date] </p>
<p><strong>Bill To:</strong><br />
Client’s Name<br />
Client’s Address<br />
City, Postcode </p>
<hr />
<p><strong>Description of Services Provided:</strong></p>
<table>
<thead>
<tr>
<th>Item/Service</th>
<th>Hours/Quantity</th>
<th>Rate (£)</th>
<th>Total (£)</th>
</tr>
</thead>
<tbody>
<tr>
<td>[Service Description]</td>
<td>[Hours/Qty]</td>
<td>[Rate]</td>
<td>[Total]</td>
</tr>
<tr>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td><strong>Subtotal:</strong></td>
<td></td>
<td></td>
<td>[Subtotal]</td>
</tr>
<tr>
<td><strong>VAT (if applicable):</strong></td>
<td></td>
<td></td>
<td>[VAT Total]</td>
</tr>
<tr>
<td><strong>Total Amount Due:</strong></td>
<td></td>
<td></td>
<td>[Total Due]</td>
</tr>
</tbody>
</table>
<hr />
<p><strong>Payment Instructions:</strong><br />
Please make payment via bank transfer to the following account:<br />
<strong>Account Name:</strong> [Your Account Name]<br />
<strong>Sort Code:</strong> [Your Sort Code]<br />
<strong>Account Number:</strong> [Your Account Number] </p>
<p>For any questions regarding this invoice, please contact me at the details above.</p>
<p>Thank you for your business!</p>
<hr />
<p>Feel free to fill in the specific sections or adjust any parts according to your needs!</p> Clover Business and Start Up Development")
