VAT

A UK tax charged on most goods and services. Once your business turnover exceeds the VAT threshold (currently £90,000/year), you must register and charge VAT.

Failing to register for VAT when required results in penalties and backdated payments. But registering also lets you reclaim VAT on business purchases, which can save thousands.

Your online store reaches £95,000 in annual sales. You must now register for VAT, add 20% VAT to your prices, collect it from customers, and pay it quarterly to HMRC.