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For a successful business, you need a viable business idea, the skills to make it work and the funding. Discover whether your idea has what it takes.

Forming your business correctly is essential to ensure you are protected and you comply with the rules. Learn how to set up your business.

Advice on protecting your wellbeing, self-confidence and mental health from the pressures of starting and running a business.

Learn why business planning is an essential exercise if your business is to start and grow successfully, attract funding or target new markets.

It is likely you will need funding to start your business unless you have your own money. Discover some of the main sources of start up funding.

Businesses and individuals must account for and pay various taxes. Understand your tax obligations and how to file, account and pay any taxes you owe.

Businesses are required to comply with a wide range of business laws. We introduce the main rules and regulations you must comply with.

Marketing matters. It drives sales and helps promote your brand and products. Discover how to market your business and reach your target customers.

Some businesses need a high street location whilst others can be run from home. Understand the key factors from cost to location, size to security.

Your employees can your biggest asset. They can also be your biggest challenge. We explain how to recruitment and manage staff successfully.

It is likely your business could not function without some form of IT. Learn how to specify, buy, maintain and secure your business IT.

Few businesses manage the leap from start up to high-growth business. Learn what it takes to scale up and take your business to the next level.

HMRC launches VAT registration estimator for small firms

16 July 2024

The UK tax body has launched a digital tool to help small firms find out what registering for VAT could mean for their business before signing up.

HMRC has launched the VAT Registration Estimator, a digital tool for small businesses to help them decide if VAT registration is right for them.

The VAT Registration Estimator has been developed in partnership with small businesses and trade representatives, who tested the online tool and gave feedback before its launch. It can help any business to see what registering for VAT could mean, as well as linking to further information about the registration process. It is also a useful tool for businesses operating below the threshold that are considering voluntary registration.

"I volunteered to be a tester for the new VAT tool. I am not a VAT expert, so approached the experience as if I were a business with no knowledge of VAT. Having made some comments, along with other stakeholders, I have now used the final tool and find it very useful. I like that when you are asked for information there are examples, links to guidance where appropriate and help on completing the boxes. A lot of work has gone into this tool, and I believe stakeholder views have been considered, to ensure the customer has the best experience possible." Karen Thomson, Administrative Burdens Advisory Board (ABAB) member.

A business must register for VAT if:

  • Their total VAT taxable turnover for the previous 12 months is more than £90,000 (the current VAT threshold).
  • They expect their turnover to go over the £90,000 VAT threshold in the next 30 days.
  • They are an overseas business not based in the UK and supply goods or services to the UK (or expect to in the next 30 days), regardless of VAT taxable turnover.

A VAT-registered business must charge VAT on eligible sales and can usually reclaim it on eligible purchases. There are around 300,000 new VAT registrations each year.

"We know that the majority of our customers want to get their tax right. We have listened to what businesses have said and the new tool is designed to help them understand VAT registration, including when they might be required to register." Jonathan Athow, HMRC director general for customer strategy and tax design.

Businesses can use the estimator whenever they like, it is free to use and it should take around 20 minutes to complete on first use. You can use the VAT Registration Estimator if you are setting up a new business and you can also experiment with different inputs and outputs. HMRC will not record the details that you input.

You can find out more about VAT registration on the government website. HMRC will host a live webinar on 24 July 2024 to explain how to use the tool. It will also be available to view on demand.

How to use the VAT Registration Estimator

  • Input whether the business is, or will be, based in the UK.
  • Input your approximate business income and business costs for the time period you wish to estimate, up to 12 months.
  • Use the guidance links provided to choose the VAT rate(s) for your business income and costs - as an estimated percentage of zero, reduced or standard rated, or VAT exempt, goods and services.
  • Then input if you would prefer to add VAT to, or absorb VAT into, your current or estimated selling price.
  • The results can be saved and printed.

Written by Rachel Miller.

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