When must HMRC cancel a person's VAT registration under Schedule 1A of the Value Added Tax Act 1994?

HMRC must cancel a person's VAT registration under Schedule 1A when that person is no longer liable to be registered and requests cancellation. The cancellation takes effect from the date of the request or a later agreed date. However, HMRC cannot cancel registration if the person would still be required to be registered under any other VAT Act provision.

Can HMRC cancel a VAT registration without a request from the registered person?

Yes, HMRC may cancel a person's VAT registration on their own initiative if satisfied the person has ceased to be liable to be registered under Schedule 1A. The cancellation takes effect from the day liability ceased or a later agreed date. HMRC must not cancel if the person would still be required or entitled to be registered under the VAT Act.

Can HMRC cancel a VAT registration retrospectively under Schedule 1A?

Yes, if HMRC become satisfied that a person was never actually liable to be registered on the day they were first registered, they may cancel the registration retrospectively from that original registration date. This effectively treats the registration as though it should never have been made, unwinding it from the outset.

How does existing VAT registration status affect the assessment of ongoing registration requirements?

When assessing whether a person would be required or entitled to be registered at a given time, HMRC must disregard provisions that would prevent registration simply because the person is already registered or liable under a different provision. Existing registration status should not mask an underlying obligation or entitlement to be registered under the VAT Act.

Value Added Tax Act 1994 section Schedule 1A paragraphs 8-12

Cancellation of registration

Section Schedule 1A paragraphs 8–12 deal with the circumstances under which HMRC can or must cancel a person's VAT registration under this Schedule, and the effective dates of such cancellation.

HMRC must cancel registration when the person is no longer liable to be registered and requests cancellation, effective from the date of request or a later agreed date
HMRC may also cancel registration on their own initiative if satisfied the person has ceased to be liable, effective from the date liability ceased or a later agreed date
No cancellation can take effect at a time when the person would still be required or entitled to be registered under any provision of the VAT Act
If a person was never liable to be registered on the day they were registered, HMRC may cancel the registration retrospectively from that original registration date

Access full legislation.And much more.

By becoming a member, your team gets full access to Tax World research tools and source-backed tax resources.

Become a member