You receive a one percent reduction in your flat rate during your first year of VAT registration. This discount applies even if the flat rate percentage for your industry changes during your first year of registration. This means you can take one percent off the flat rate you apply to your turnover until the day before your first anniversary of becoming VAT registered.
This reduction runs for the 12 months following the date you register for VAT, not the date you join the Flat Rate Scheme. You cannot apply the reduction if you register for VAT 12 months after you were required to do so.
If your business is a transfer of a going concern (TOGC), you are entitled to apply the one percent reduction from the date of the transfer.
Important: Make a note of the date on which you will need to change your VAT percentage rate, at the end of the reduced rate period, so that you don't underpay VAT.
For more information, go to the HMRC website.