📊 How to Calculate VAT Rolling 12-Month Turnover

If you’re self-employed or running a small business, understanding when you need to register for VAT is crucial. One key trigger is your rolling 12-month turnover – but what does that actually mean, and how do you calculate it?

Let’s break it down.

🔍 What is “Rolling 12-Month Turnover”?

A rolling 12-month period means you look at any 12-month window (not just your accounting year), and check if your VAT-taxable turnover exceeds the VAT registration threshold, which is currently £90,000 (as of 2024/25).

Unlike fixed financial years, this method updates every month – so you must check regularly.

🧮 How to Calculate It – Step-by-Step

1. List your VAT-taxable sales
   These are all goods and services you sell that are subject to VAT (whether standard, reduced or zero-rated – but not exempt sales).
2. Check the last 12 months (not just the tax year)
   For example, if today is June 2025, you need to add up sales from July 2024 to June 2025.
3. Update the total each month
   At the end of each new month, drop off the oldest month and add the newest.

💡 Example

Let’s say your monthly VAT-taxable turnover looks like this:

Add up all 12 months:

Total = £91,300 ✅

Since this exceeds the £90,000 threshold, you must register for VAT within 30 days of the end of the month in which you went over.

⚠️ Key Tips

• This is a rolling test, not just once a year – review monthly!
• Keep accurate monthly records.
• Don’t include exempt income (e.g., some rent or financial services).
• Include zero-rated sales – they still count towards the threshold!

📌 What Happens If You Go Over?

You must notify HMRC within 30 days of breaching the threshold. You’ll be VAT-registered from the 1st day of the second month after you go over – unless you apply for an exception.

🚀 Need Help?

If you’re unsure how to track your turnover or whether you’ve hit the limit, speak to an accountant (yes, like us! 😄).

We’ll keep you compliant – and stress-free.