It depends almost entirely on who your customers are. If you sell to VAT-registered businesses, registering is often free money: they reclaim the VAT you charge so your price is effectively unchanged, while you start reclaiming VAT on your own costs. If you sell to the public, it is a 20% price rise you either absorb or pass on, and neither is comfortable. So a contractor working for developers should probably register; a mobile hairdresser should probably not. Secondary considerations: registration adds a compliance burden and puts you into MTD for VAT immediately, and it makes you look larger, which matters in some markets. The trap is registering for credibility and then discovering your margin has quietly dropped by a fifth.