vat deregistration, 30 day rule

lorraine

Hi there,

Been reading that if a client of mine is under the deregistration threshold for the next 12 months, because he ceased to trade for more than 30 days, he is unable to deregister. Is this correct?

Thanks in advance.

Lor

douglasstroud

How if they have already ceased to trade for 30 days does this affect the following 12 months unless they are still not trading?

lorraine

https://www.accountingweb.co.uk/tax/business-tax/vat-dont-deregister-in-haste, example 1

This is what I'm reading, as I have client who has temporarily suspended sales (sorry previously incorrect terminology) he thinks he may get more work but is unsure. I believe that he shouldn't deregister because of the suspended sales for more than 30 days.

lorraine

Anyone know the answer to my question please?

douglasstroud

I agree that he should not cancel registration because he is still not trading, if he was to start trading again and then deregister then that I believe would be different, however if they were to then get more work as a result of this and go over the threshold they would have to register again and this may be open to a HMRC challenge of why they cancelled registration in the first place

lorraine

Thank you for your reply appreciated.