If you are a vat registered trader in the UK that wants to surrender your vat certificate for a number of reasons then you will want to learn everything about the vat deregistration process to cancel your vat number. Although the procedure for canceling vat registration is pretty simple, you will still have to take into account vat and file your final vat return.
There are several reasons that could compel one to come out of the vat system. You can apply for deregistration of vat in case your business has collapsed and you’ve filed for insolvency, your taxable sales have dropped dramatically and you expect them to drop below the vat threshold limit of ?70,000 within the next 12 months, you sell your business, there’s a change in the legal status of your business, you either join another vat group or disband your present vat group, or you want to join the agricultural flat rate vat scheme. There are various other reasons which are specified by HM Revenue and Customs or hmrc vat department that could make you a valid candidate for vat deregistration.
You can also voluntarily step out of the vat tax system in case your taxable supplies are mainly or even wholly zero rated. You can even do this if 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 the reasons you wish to cancel your vat registration. Once you’re deregistered from vat then you will not be allowed to issue vat invoices or file vat returns.
For you to deregister yourself from vatnumbers you will have to get hold of your vat agent that should direct you on the exact process that must be followed in order that you do not end up making errors. You will have 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 in this range. This form will need your vat registration number, business name and address, and may need you to tick the right reason as to why you have applied for deregistration along with providing the required anticipated sales figures. You will also need to mention the gross value including vat of stocks and assets that you currently hold. You will also need to specify if you stick to the vat cash accounting system.
After you have filled up the vat deregistration form then hmrc will usually reply in a time period of 3 weeks. In case you do not receive a reply then you should remind them. If hmrc is satisfied with the application then you’ll receive 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 direct you on matters regarding reclaiming vat after deregistration and claiming relief on bad debts after deregistration.
If certain circumstances compel you to apply for cancellation of your vat certificate then you’ll have to follow proper procedure as laid down by hmrc vat department. If your entire papers have been in order and if there are no mistakes in the deregistration form then you should be out from the vat system in a month of filing vat deregistration.