VATDREG14000 | Effective date of cancellation (EDC)

The effective date of cancellation (EDC) refers to the date when a person is formally deregistered for VAT. A person is unable to charge VAT or recover input tax on supplies made after this date unless they becomes liable or registered for VAT again.

The EDC is typically the date a person ceases to make supplies, usually when they stop trading, or voluntarily deregister - for example, if their value of supplies falls below the relevant threshold. A person who is requesting voluntary deregistration because they are no longer liable to be registered under any schedule, can only do so from the date of the request or a future date if agreed by HMRC. There is no legal provision to allow deregistration from an earlier date.

Neil & Alma Grogan T/A Valet Plus (EDN/98/201) reinforced the need for a person to follow up on their submission of deregistration application if they do not receive an acknowledgement. In guidance we ask customers do so after a 30-day period.
HMRC confirms this date when a person successfully applies for VAT deregistration using the online services or VAT7 form or HMRC takes action to compulsory deregister a business.

Determining the EDC
Registration ceases at midnight on the day preceding the EDC. The EDC will therefore be the following day. For example, if a trader’s deregistration is with effect from 1 October, the last day of registration will be 30 September.

Once deregistered, the trader must then make a final return and pay any tax due, within the required time stated in the VAT regulations. This is usually one month and seven days from the EDC or the day we confirm the EDC, whichever is later.

This can vary for persons on the Cash Accounting Scheme (VAT Notice 731) or Annual Accounting Scheme (VAT Notice 732).

An EDC can only be amended if HMRC is satisfied the person ceased to be liable or entitled to be registered under any schedule from an alternative date. HMRC can agree to a later EDC with agreement, usually for the disposal of assets – see VATDEREG13000.

Invalid registrations
If a registration is found to be invalid, the effective date of cancellation becomes the date the person was registered. The effect is to void the entire registration. See VATREG31050.