VAT threshold no longer met

Hi I was wondering if I could get some advice please. I’m a sole trader, last financial year I went over threshold and then had to register for VAT, I’ve done my first VAT return and paid, 6 months into this financial year my figures are very low compared to last year and I do not believe I will be going over or near the threshold this financial year. My question is if I keep paying my VAT, but at the end of the year I haven’t gone near the threshold can I get a refund on the VAT I have paid during the year? Or should I just de register now as sales have gone down drastically since adding on the 20% VAT to my prices, so definitely won’t be reaching the threshold, I’m not even near halfway mark yet. Any advice would be appreciated on what I could do please. Thank you

The deregistration threshold is a rolling 12 month test, same process as the registration. Look back 12 months from end of August 2023 and if your turnover is below £83,000 then you can deregister for VAT. You cannot deregister until you go below that threshold. You should therefore start looking backwards to find out when you can deregister, do not wait until the end of your financial or calendar year. If the conditions have been met, you can deregister online via your gateway https://www.gov.uk/register-for-vat/cancel-your-registration Once deregistered any sales from your deregistration date are no longer subject to VAT. When you do deregister, you may have to repay input tax previously reclaimed when you were VAT registered. In essence, any stock or asset where the combined value is more than £5,000 net, would mean you have to declare output tax on these items when you deregister. If your stock/assets is less than £5k then there is nothing to declare to HMRC. So if you bought a van or pickup, reclaimed the VAT, when you deregister chances are it'll be worth more than £5k and so output tax due, but if you bought some hand tools and a filing cabinet, these aren't going to be worth much and so nothing to declare. Follow the link above for more information.

Thank you so much for that information and advice. I will now check back I’ve last 12 months and see where I’m at with the figures. I don’t have anything of high value which I’ve reclaimed for, as my business is all online. Thank you very much. Most appreciated

Hi. If you have registered for VAT but are satisfied that you will be staying under the threshold for the next year then you can choose to deregister voluntarily. Please see the guidance below: VAT Notice 700/11: cancelling your registration However you are unable to reclaim any VAT which you have paid HMRC as the deregistration date can not be backdated.

Thank you.