Threshold: Mandatory registration when your taxable turnover exceeds £90,000 in a rolling 12-month period.

Voluntary registration: You can register below the threshold to reclaim VAT on business purchases, which may benefit startups or businesses with high input costs.

VAT schemes: Options include the Flat Rate Scheme for simplified reporting, Cash Accounting for better cash flow, and Annual Accounting for fewer returns.

Application process: Apply online through HMRC's portal, usually taking 2-4 weeks; you'll need details like business turnover and bank information.

VAT rates: Standard rate is 20%, with reduced rates of 5% (e.g., energy-saving materials) and 0% (e.g., most food) for specific items.

Invoicing: Issue VAT invoices showing your VAT number, the VAT charged, and net/gross amounts for all taxable sales.

Record-keeping: Maintain records of sales, purchases, and VAT for at least 6 years, including invoices, receipts, and bank statements.

VAT returns: File quarterly or monthly returns through Making Tax Digital (MTD)-compatible software, paying any VAT due within one month and seven days after the period ends.

Making Tax Digital (MTD): VAT-registered businesses must use MTD software for digital record-keeping and submissions; this applies from your first return after registration.

Penalties: Late registration, filing, or payment can result in fines from HMRC, calculated based on the VAT due and how late it is.