The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
It is possible in certain circumstances for a business to effectively 'revoke' a valid option to tax. This guidance note provides an overview of the circumstances in which a business can revoke an option to tax and the procedure that must be followed.
Please note that HMRC has made some temporary changes to notifying an option to tax during the COVID-19 (coronavirus) outbreak (notably extending the deadline for notification from 30 to 90 days). These changes aren’t covered in this guidance note; but for details, see the Coronavirus (COVID-19) and VAT - further VAT consequences guidance note.
It is possible for a business that has opted to revoke the option if it changes its mind within six months of making the election. .
The business must satisfy the following conditions before it can revoke the option to tax:
less than six months have elapsed since the day from which the option had effect
no VAT has become chargeable on a supply of the land as a result of the option (ie the business has not made any supplies of the property that would be liable to VAT since opting to tax)
the property has not been transferred as part of a transfer of a going concern since the business opted to tax (see the TOGC ― overview guidance note)
If the above conditions are satisfied, the business can request permission to revoke the option to tax from HMRC. The business will need to complete and submit a VAT1614C in order to request permission to revoke the option to tax. If the business also satisfies the conditions below it does not require permission from HMRC in order to revoke.
These are the additional conditions that need to be satisfied before a business will be entitled to revoke the option to tax without obtaining prior permission from HMRC. Please note that the business only needs to satisfy one of these additional conditions:
if neither the business, nor
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