Commentary

V7.155 Administrative savings by not being VAT registered

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.155 Administrative savings by not being VAT registered

Part V7 Tax planning | Commentary

V7.155 Administrative savings by not being VAT registered

A business can also deregister if it can convince HMRC that all, or most, of its sales are, or will be, zero-rated, and therefore any VAT return submitted would always be a repayment claim.

In most cases, a business making zero-rated supplies will be reluctant to deregister because of the loss of input tax recovery. However, certain businesses have negligible input tax to claim, and therefore gain little advantage in being registered. See Example 4.

Example 4

Mrs E runs a business that buys eggs (zero-rated) from a local farm and sells them to surrounding

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