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It is not necessary to register a Company for VAT until its turnover hits a certain level, i.e. once the sales exceed £67.000 in a year or you can make a voluntary registration even before hitting this threshold.  The benefit of registering is that this enables you to recover any VAT that you incur on things that you buy for the business (e.g. computer equipment/accountancy fees). However, you will need to fill out a quarterly VAT return yourself if you do not have an accountant to do this for you. 

VAT registration usually takes about 8 weeks, but this will not prevent you from invoicing your agency or reclaiming VAT on expenses. Until the Company is registered you simply raise sales invoices without adding on VAT.  Once the Company is VAT registered you must show the registration number on your invoice and add VAT at the appropriate rate.  Any VAT payable must be paid by the last day of the month following the VAT quarter and there are penalties for late payment.

In order to recover VAT on things that you buy for the business you must obtain a "VAT Invoice/Receipt" showing the supplier’s VAT No. Always ask for a VAT invoice or receipt as they will not automatically be provided every time.