Deregistering for VAT

VAT thresholds are the subject of much speculation as the Government is concerned that many business owners are deliberately choosing to remain below the VAT registration threshold.

Whilst limiting your turnover in this way might seem counter-intuitive – surely you want your business to get as big as possible, it can make sense if you’re seeking to make a comfortable living rather than get rich.

If the turnover of your business is predicted to fall below £83,000 over the next year, it can voluntarily deregister for VAT.

You would also need to deregister from paying VAT if your business ceased to trade.

Voluntary deregistration

Your business can deregister if it expects taxable sales in the next 12 months to be less than the deregistration threshold, which is currently £83,000. A voluntary deregistration from VAT can take effect from a current or future date.

If you fail to specify a date, the deregistration will take effect from the date HMRC receives the application to deregister, or a later date as agreed with HMRC.

You can’t backdate deregistration, even if you’ve made a mistake in registering for VAT, or you could have applied to deregister earlier but didn’t for whatever reason.

Compulsory deregistration

If your business has ceased to trade and will not make future taxable sales, it must deregister from VAT with effect from the final day of trading.

There is scope though to extend this date and thereby capture some final purchase invoices for the purposes of reclaiming input VAT. It’s almost certain that there would be professional fees to pay, which arrive after a business makes its last sale.

If you’d like to discuss this further with us then contact us via the number at the top of the page.


This article is for general guidance only. It provides an outline, and may not include points which are important to your situation. You should not depend on this blog without taking advice based on the full facts of your case. The information given was correct at the time of publication.

DID YOU FIND THIS USEFUL?

Share it with your network:  

Want more great content?
Sign up to our newsletter

Follow us

Tweets by @CHW-accounting

CHW-Accounting
@chw-accounting


Twitter: chw_accounting

WHAT'S THE NEWS?

Grab a biscuit and a brew and read our latest news.

12 February 2019

Accounting tips for small businesses

by

If you are running a small business or considering setting up a small business, CHW Accountants in Bolton provide some top tips to help ensure your success.


Read more >

7 February 2019

Deregistering for VAT

by

If the turnover of your business is predicted to fall below £83,000 over the next year, it can voluntarily deregister for VAT.


Read more >

18 January 2019

MTD Event – 7th Feb 2019

by

We’re holding a free MTD that will cover everything you need to know about MTD and the steps you need to take to become MTD compliant. Barclays Bank will also be present to talk about cyber security in the post MTD world.


Read more >

18 January 2019

Cash is King

by

Managing cash flow is one of the most fundamentally important aspects of financial management for any business. Whilst controlling the amount of cash coming in and going out sounds straightforward, getting the balance wrong can put your entire operations at risk.


Read more >

8 January 2019

Everything you need to know about Capital Gains Tax

by

Capital Gains Tax (CGT) affects both individuals and businesses and there is a high chance that you are likely to be affected by CGT at some point. But what is it and how is it calculated? We have all the answers that you need.


Read more >

YOUR CHALLENGES

No matter what your challenge is, we’ve probably dealt with it before.



Need an Accountant?

Get in touch >


Need an Accountant?

Get in touch >


Tax issues?

Find out more >


Tax issues?

Find out more >


Trying to grow your business?

We can help >


Trying to grow your business?

We can help >


Managing cashflow?

We can help >


Managing cashflow?

We can help >


Starting a business?

We can help >


Starting a business?

We can help >


Looking for funding?

Need help with funding? >


Looking for funding?

Need help with funding? >


Buying or selling a business?

We can help >


Buying or selling a business?

We can help >


Adopt the cloud?

We can help >


Adopt the cloud?

We can help >


What else can we do for you?

We can help >


What else can we do for you?

We can help >
CONTACT US

Get in touch, no hard sell, just a brew, a biscuit and a chat.