If you’re a vat registered trader in the UK that desires to surrender your vat certificate for a variety of reasons then you need to know all about the vat deregistration process to cancel your vat number. Although the process of canceling vat registration is pretty simple, you still need to account for vat and file a final vat return.
There are many reasons that may compel you to leave the vat system. It is possible to make an application for deregistration of vat in case your business has collapsed and you have filed for insolvency, your taxable sales have dropped dramatically and you expect them to drop below the vat threshold limit of ?70,000 in the next 1 year, you sell your organization, there’s a alternation in the legal status of your business, you either join another vat group or disband your existing vat group, or you want to join the agricultural flat rate vat scheme. There are several other reasons that are specified by HM Revenue and Customs or hmrc vat department that can allow you to be a valid candidate for vat deregistration.
You may also voluntarily step out of the vat tax system if your taxable supplies are generally or perhaps wholly zero rated. You can even do this in case your input tax usually exceeds your output tax. However, out of all above circumstances you will need to provide required proof in addition to convince hmrc vat regarding the genuineness of the reason as to why you wish to cancel your vat registration. Once you’re deregistered from vat then you’ll no longer be allowed to issue vat invoices or file vat returns.
For you to definitely deregister yourself from vat validation you will have to get hold of your vat agent that will guide you on the exact process to be followed so that you don’t end up making errors. You will need to fill up the VAT 7 vat form once you have read and understood vat notice 700/11 on ?Canceling your registration? along with notice 700/1 among other notices within this range. This form will need your vat registration number, business name and address, and will require you to tick the right reason as to why you’ve requested deregistration in addition to providing the required anticipated sales figures. You will also have to mention the gross value including vat of stocks and assets which you currently hold. You will also have to specify if you follow the vat cash accounting system.
Once you have filled up the vat deregistration form then hmrc will usually reply in a period of 3 weeks. In case you do not receive a reply then you should remind them. If hmrc is content with the application then you’ll get a formal notice of vat cancellation on VAT35 form and also receive a formal notice of exemption from registration on VAT8 form. Your vat agent will be able to guide you on matters regarding reclaiming vat after deregistration and claiming relief on debt after deregistration.
If certain situations compel you to make an application for cancellation of your vat certificate then you will have to follow proper procedure as laid down by hmrc vat department. If all your papers have been in order and if there are no mistakes in the deregistration form you then should be out of the vat system within a month of filing vat deregistration.