Net (ex VAT): £0.00
Gross (inc VAT): £0.00
VAT (at 20%): £0.00
Popular Worldwide VAT Rates
VAT Registration Statistics & Trends 2025
Looking for the latest VAT statistics? This resource is built to be simple and easy to use. All figures are kept up to date. Each statistic is checked and reviewed for accuracy. The data is selected by our CEO, Oliver Smith. It is written to be clear and easy to understand.
How Many UK Companies Are Registered for VAT?
We requested the latest VAT registration data from HMRC. We are still waiting for Q2, Q3, and Q4 2024 data. We are also waiting for Q1 2025 figures. The most recent available data is from March 2024. It shows 2.725 million VAT-registered UK businesses. This is a 1.55% fall from the 2022 peak. It is also a 0.08% drop from 2023.
Why Have VAT Registrations Declined?
Many businesses started during the COVID period. This caused strong growth after the lows of 2019. Costs have risen since then. Inflation remains high. Interest rates have increased. Consumer spending has slowed.
As a result, many small businesses closed. Others chose to deregister from VAT.
Impacting Conditions Behind the Decline
Economic Pressure
High inflation has increased business costs. Interest rates have risen and made borrowing harder. Consumer spending has slowed across many sectors. Because of this, many businesses have closed. Others have defaulted on VAT payments. Some have entered insolvency.
Energy costs and supply chain issues have put extra pressure on already struggling businesses. These excess costs are starting to normalise as of March 2025.
Threshold Considerations
Some businesses choose to stay below the VAT threshold of £90,000.
This helps them avoid VAT registration.
Others split activity across more than one business.
They do this to remain under the threshold.
Brexit Effects Still Ongoing
Some small exporters and importers have closed.
Others moved part of their business outside the UK.
Extra paperwork has raised costs.
Trade delays have also reduced margins.
Move Toward Gig and Informal Work
More people now work through gig platforms.
Examples include freelancing and delivery apps.
Many earn below the VAT threshold.
Others stay unregistered to keep things simple.
Check If VAT Registration Is Right for You
If you are unsure about VAT registration, use our VAT calculator.
It helps you test prices and see how much VAT you can reclaim.
VAT registration by company type
VAT registration company type structure
Regional Distribution of VAT and PAYE Businesses
London leads all regions.
In 2024, it had 530,815 VAT or PAYE businesses.
The South East of England followed next.
It recorded 437,045 enterprises.
Business Size by Employment
Most VAT and PAYE businesses are very small.
In 2024, over 2.12 million UK businesses had zero to four employees.
This shows small businesses make up the majority of the market.
Industry Insights
Professional and Technical Services
This is the largest business sector in the UK.
It made up 15.2% of all VAT-registered businesses by March 2023.
Retail Sector
Retail business numbers fell sharply.
Excluding motor trade, 42,450 retailers closed in one year.
This equals a 12.7% decline.
Despite this drop, retail remains important.
It generated £16.4 billion in VAT receipts.
That is over 9% of total VAT collected by HMRC.
Sources