Cancelling your VAT registration

When you can deregister

You can apply to cancel your VAT registration if your taxable turnover for the next 12 months will not exceed the deregistration threshold of £88,000. Note that this sits below the £90,000 registration threshold — the gap is deliberate, so you are not forced to flip in and out as turnover hovers. You must also deregister if you stop trading or stop making taxable supplies. Cancel your VAT registration

How to apply

Apply online through your VAT account, or by paper form VAT7. HMRC confirms a cancellation date — usually the date you ask for, or the date your reason for deregistering takes effect.

The final return — don’t miss this

On your final VAT return you may have to account for VAT on stock and assets you keep, if you could reclaim VAT when you bought them and their total value is over the limit. This catches people who deregister with valuable equipment on hand. Keep your VAT records for six years after deregistering.

Should you instead stay under?

If you are not yet registered but approaching the threshold, the question is different — see voluntary vs compulsory registration and keep an eye on your rolling total.