The Value Added Tax Regulations 1995

Withdrawal from the scheme

64.  —

(1) A person shall not be entitled to continue to operate the scheme where—

(a) he has, while operating the scheme, been convicted of an offence in connection with VAT or has made a payment to compound such proceedings under section 152 of the Customs and Excise Management Act 1979,

(b) he has while operating the scheme been assessed to a penalty under section 60, 63, 67 or 69 of the Act or to a surcharge under section 59 of the Act,

(c) he has failed to leave the scheme as required by regulation 60(2),

(d) he has claimed input tax as though he had not been operating the scheme, or

(e) the Commissioners consider it is necessary for the protection of the revenue that he shall not be so entitled.

(2) A person who, by virtue of paragraph (1) above, ceases to be entitled to continue to operate the scheme shall account for and pay on a return made for the prescribed accounting period in which he ceased to be so entitled—

(a) all VAT which he would have been required to pay to the Commissioners during the time when he operated the scheme, if he had not then been operating the scheme, less

(b) all VAT accounted for and paid to the Commissioners in accordance with the scheme,

subject to any adjustment for credit for input tax.

(3) A person who ceases to operate the scheme may be required to account for and pay on a return made for the prescribed accounting period in which he ceased to operate the scheme—

(a) all VAT which he would have been required to pay to the Commissioners during the time when he operated the scheme, if he had not then been operating the scheme, less

(b) all VAT accounted for and paid to the Commissioners in accordance with the scheme,

subject to any adjustment for credit for input tax, notwithstanding that he has already withdrawn from the scheme of his own volition.