VAT - Historic Test

Question 1

How often is the historic test performed?

Answer 1

At the end of each month

Question 2

What is the historic test?

Answer 2

When, at the end of the month, the trader looks back at the past 12 months to see if total taxable supplies have exceeded the registration limit

Question 3

If total taxable supplies have exceeded the registration limit in the last 12 months, when should the trader notify HMRC by?

Answer 3

Within 30 days of the end of the month in which the turnover limit is exceeded (the relevant month)

Question 4

If total taxable supplies have exceeded the registration limit in the last 12 months, when should the trader start charging VAT?

Answer 4

From the first day after the end of the month following the relevant month

Question 5

When does a trader not need to register?

Answer 5

• if taxable supplies for the next 12 months are expected to be less than the DEREGISTRATION limit
• if the business only makes zero-rated supplies

Question 6

What does taxable supplies mean?

Answer 6

All sales excluding:
- VAT
- exempt supplies
- supplies outside the scope of VAT
- sale of capital assets