Hi there
Just a quick one re VAT
If you are registered for VAT and then deregister are you liable to pay back all the VAT you claimed
My brother said you are but does not make sense to me
Thanks for reading and advice
Noel
Hi there
Just a quick one re VAT
If you are registered for VAT and then deregister are you liable to pay back all the VAT you claimed
My brother said you are but does not make sense to me
Thanks for reading and advice
Noel
It depends. Without going into the precise complexities of VAT rules, the normal rules are:
It you are obliged to register for VAT because your turnover exceeds or is likely to exceed the registration threshold limit, then you are entitled to claim back all VAT costs that directly relate to the business and account for VAT on all supplies. If and when you cease trading there is no obligation to pay back any excess of VAT recovered.
However, if you elect to register (i.e. your turnover will not exceed the registration limit), which you might do to recover VAT on set up costs. then in this scenario there are rules relating to a clawback of VAT recovered in excess of output VAT.
Yes there is, you are obliged to repay and excess vat reclaimed. Ie you cannot reclaim more vat than you have paid over the life of the registration.
Yes there is, you are obliged to repay and excess vat reclaimed. Ie you cannot reclaim more vat than you have paid over the life of the registration.
If one is obliged to register, say as a butcher through being over the limit, ones sales are largely at 0%. One has expenses at 21% and 13.5% which one is entitled to reclaim. If the business then ceases there is no obligation to repay excess VAT claimed. It is in situations of voluntary registration while under the limit that excess VAT reclaimed is liable to be repaid.
PS to the OP, could you make the title of the thread more specific than just "VAT"
Niall M,
Your comments are incorrect and my reply is backed up by subsequent poster !
If one is obliged to register, say as a butcher through being over the limit, ones sales are largely at 0%. One has expenses at 21% and 13.5% which one is entitled to reclaim. If the business then ceases there is no obligation to repay excess VAT claimed. It is in situations of voluntary registration while under the limit that excess VAT reclaimed is liable to be repaid.
PS to the OP, could you make the title of the thread more specific than just "VAT"
i wonder if this is correct, i have just seen a property company having to repay large amounts of vat. they registered as they have been over the limits. interesting one with 0% sales, i will ask tax expert at work tomm this.