You must cancel your registration if you’re no longer eligible to be VAT registered. For example:
- you stop trading or making VAT taxable supplies
- you join a VAT group
You must cancel within 30 days if you stop being eligible or you may be charged a penalty.
You can ask HM Revenue and Customs (HMRC) to cancel your registration if your VAT taxable turnover falls below the deregistration threshold of £83,000.
How to cancel
You can cancel your VAT registration online.
You can also fill in and send form VAT7 to cancel your VAT registration by post.
What happens next
It usually takes 3 weeks for HMRC to confirm your cancellation and the official cancellation date. This is either the date when the reason for your cancellation took effect (for example, when you stopped trading), or the date you asked to cancel if it’s voluntary.
HMRC will send confirmation to your VAT online account (or through the post if you do not apply online). From the date of cancellation you must stop charging VAT and keep your VAT records for 6 years.
HMRC will automatically re-register you if they realise you should not have cancelled. You’ll have to account for any VAT you should have paid in the meantime.
VAT after you cancel
You’ll have to submit a final VAT Return for the period up to and including the cancellation date. You must account for any stock and other assets you have on this date if:
- you could reclaim VAT when you bought them
- the total VAT due on these assets is over £1,000
Do not wait until you’ve received all your invoices before submitting your final return. You’ll still be able to reclaim VAT on anything you bought for your business while still registered once you get the invoices.