There are several reasons why it is not advisable to register your company for VAT on a voluntary basis.

If your clients are not VAT registered themselves, for instance maybe they are a charity, then they would not be able to reclaim the VAT you charge them. Therefore they may pay you a better rate if you are not VAT registered.

If the majority of your work is carried out outside the UK then there may be a limited amount of VAT on purchases and expenses incurred in the UK for you to recover. Foreign VAT incurred cannot be recovered through the UK VAT system although you can make a separate online claim for VAT incurred in EU countries (probably only worth doing if it is significant).

If you are certain your annual turnover will be below £85,000 then you might not want the additional administrative burden of recording all VAT collected and incurred, and filing quarterly returns. In addition to this, from April 2019 Making Tax Digital (MTD) will come into force, requiring all VAT registered businesses to submit their returns electronically via MTD compatible accounting software. This means that you will need to keep your software up to date at least every quarter as a minimum requirement.

Note that if you choose NOT to register for VAT, you must monitor your turnover on a rolling 12 month basis and advise us as soon as you think you may exceed £85,000, so we can apply for VAT registration. There are penalties for not doing so within 30 days.