Cross the rolling twelve-month threshold and your prices effectively rise 20% overnight for domestic customers. Plan for the cliff before it arrives.
16 July 2026 · 5 min read
VAT registration is compulsory once your taxable turnover passes the threshold (£90,000, on current rules — check GOV.UK) in any rolling twelve months. The rolling part catches people out: it is not your accounting year, it is any consecutive twelve months, checked continuously.
For trades serving VAT-registered businesses, registration is nearly painless — customers reclaim the VAT. For domestic work it is a genuine cliff: your labour effectively costs households 20% more, against competitors under the threshold. That is why timing and awareness matter more for trades than most sectors.
The trap is finding out in arrears that you crossed months ago — late registration means owing VAT you never charged. The defence is boring: know your rolling turnover. If your invoices are digital and dated (every GraftG invoice is numbered, dated and logged), the running total is checkable rather than mystical.
Some trades near the line manage turnover deliberately; others register and lean in — reclaiming VAT on the van, tools and materials, and pitching for commercial work where VAT is neutral. Either is legitimate strategy; drifting over the line unaware is not. Once registered, your invoices must show VAT properly — GraftG handles VAT lines automatically, and the VAT invoice template shows the required layout.
Registration is compulsory when taxable turnover exceeds the threshold — £90,000 under current rules — in any rolling twelve-month period, or when you expect to exceed it in the next 30 days alone. Verify the current figure on GOV.UK.
HMRC treats you as registered from the date you should have been — meaning VAT is due on sales where you never charged it, plus potential penalties. A monthly glance at rolling turnover is cheap insurance.
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