Taxable supplies: when notification must be made
The time limits for when a person must notify his liability for registration are contained in the VAT Act 1994, Schedule 1, paragraphs 5 and 6. The general rule is that a person has 30 days in which to notify, but the starting date for those 30 days will vary according to what triggered his liability to register.
The backward look
VAT Act 1994, Schedule 1, paragraph 5 covers the ‘backward look’ and provides that a person shall notify his liability to register within 30 days of the end of the month the liability arose.
On 22 April, the value of a trader’s supplies in the past 12 months exceeds the registration threshold.
|Registration threshold exceeded||22 April|
|Trader becomes liable to be registered||30 April|
|Trader must notify liability by||30 May|
|EDR will be (see section 8)||1 June|
You can see that there is a period of time between being liable to be VAT registered and the EDR provided by law. During this period, the person is not a taxable person within the meaning of the VAT Act 1994, section 3.
The forward look
VAT Act 1994, Schedule 1, paragraph 6, which covers the ‘forward look’, provides that a person must notify his liability to register within 30 days of the day the liability arose.
On 22 April, a trader expects that the value of his supplies in the next 30 days alone will exceed the registration threshold.
|Trader forms the expectation||22 April|
|Trader becomes liable to be registered||22 April|
|Trader must notify liability by||22 May|
|EDR will be||22 April|
Guidance on calculating the effective date of registration can be found in VATREG25000.