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ACCA Strategic Professional · Advanced Taxation (UK) · Statutory obligations, time limits and the implications of non-compliance

Marlow Ltd is not VAT registered. At the end of a month its taxable turnover for the previous 12 months is £91,500. Using the ATX-UK registration limit, what is the correct position?

Marlow Ltd must register for VAT. Its taxable turnover over the previous 12 months of £91,500 exceeds the £90,000 registration limit, so it must notify HMRC. The £88,000 figure is the deregistration limit and is irrelevant to the compulsory registration test.

  1. AIt must notify HMRC because turnover exceeds the £90,000 registration limitCorrect
  2. BIt need not register because turnover is below the £88,000 deregistration limit
  3. CIt must register only if turnover exceeds £90,000 in the next 12 months
  4. DIt may delay registration until the end of the tax year

Explanation

A business must register where taxable turnover for the past 12 months exceeds the £90,000 registration limit. Turnover of £91,500 exceeds it. The £88,000 deregistration limit applies only to deregistration, not to the registration test.

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