Do I Need to Charge VAT as a UK Sole Trader? (2026 Rules)

Most sole traders don't need to charge VAT until their turnover crosses a set threshold. Here's exactly when you're required to register, how the two HMRC tests work, and what changes on your invoices once you are VAT-registered.

The £90,000 threshold

You must register for VAT once your total taxable turnover for the last 12 months goes over £90,000. This is a rolling 12-month total, not your turnover in a single tax year — so it's checked continuously, and it can be triggered any month, not just at year-end.

The two tests that can trigger registration

• The rolling 12-month test: your taxable turnover for the past 12 months (looking backwards from any point) goes over £90,000.
• The 30-day forward test: you expect your taxable turnover to go over £90,000 in the next 30 days alone — for example, if you've just landed one large contract.

Registration deadlines

The deadline depends on which test applies:

• Rolling 12-month test: register within 30 days of the end of the month in which you went over £90,000. You become VAT-registered from the first day of the second month after that.
• 30-day forward test: register by the end of that 30-day period. You become VAT-registered from the date you realised you'd go over the threshold — not the date it actually happens.

Either way, once HMRC registers you, you must account for VAT on your sales from your effective registration date — even on invoices you'd already planned before you hit the threshold.

A worked example

Here's how the rolling 12-month test plays out for a hypothetical self-employed electrician tracking their turnover month by month:

Their rolling total crossed £90,000 at the end of April 2026. Under the rolling 12-month test, they must register by 31 May 2026 — 30 days after the end of the month they went over — and become VAT-registered from 1 June 2026, the first day of the second month after crossing the threshold.

You can also register voluntarily

You don't have to wait until you're over the threshold. Some sole traders register voluntarily while still below £90,000 — for example, to reclaim VAT on business purchases, or because most of their clients are VAT-registered businesses who can reclaim the VAT themselves either way.

What changes on your invoices once you're VAT-registered

A VAT-registered sole trader must issue full VAT invoices, which include your VAT registration number and a VAT breakdown by rate, in addition to everything a standard UK invoice already requires. See our full UK invoice requirements checklist for the complete list.

Keep it simple either way

FairInvoice's free invoice generator is built for UK sole traders whether or not you're VAT-registered — add your VAT number once your registration comes through, and it's included on every invoice from then on.

Source: GOV.UK — VAT registration: When to register