Will I have to pay back reclaimed VAT if I deregister?

Hi! I voluntarily registered for VAT in April when I started my business as I knew that I had a lot of purchases to make that I wanted to reclaim the VAT on. I now don't have any further large purchases to make and I fall well under the VAT threshold. I am continuing my business but my question is, if I deregister from VAT now will I then have to pay back the VAT I reclaimed? For example. I bought a van that I use and will continue to use for my business. I paid £13,000 inc VAT and reclaimed the £2000 VAT. If I deregister now will I be forced to repay that £2000 to HMRC? Many thanks for any advice!

Name removed admin .

You have to declare output tax on any stock, assets or goods where the combined value is more than £5,000 net. So your van cost £13,000, assuming the current value is 50%, less than what you paid (£7,500) this is over £5,000 and you'd have to declare output tax on your final VAT return of £1,500.00 Of course, the value of the van will be much higher than in my example, you purchased it 4 months ago in April so will not have depreciated by my 50% example. You would also have to include the current market value of any tools, machinery, equipment and any stock of materials in this calculation. These rules exist primarily to stop traders from registering for VAT just so that they can reclaim input tax on purchases and then deregister. https://www.gov.uk/government/publications/vat-notice-70011-cancelling-your-registration/vat-notice-70011-cancelling-your-registration#section-7 "When you cancel your VAT registration, you usually make what is known as a deemed supply of the goods you have on hand. This means you may have to account for VAT on some of your business assets and stock on hand, depending on: what they are how you obtained them why you’re cancelling your registration You will not have to account for VAT if the total VAT due on the assets would be £1,000 or less.

Hi Marcus Carter,

If you have claimed input tax on goods and you have these goods on hand when you deregister then you will need to do a stock take of these goods and account for the VAT on your final VAT return.
Please see the guidance below:
7. Business assets and stock on hand

Thank you.