When May a Taxable Person Request VAT Deregistration?
A taxable person may submit a deregistration request to the competent unit in the following cases:
First: Mandatory Registration
- When turnover falls below the threshold established by law for persons subject to mandatory VAT registration.
- When the taxable person ceases carrying out taxable activities.
Important note: In the event of a permanent cessation of business, submitting Form M6 to the Income Tax Department is sufficient.
Second: Voluntary Registration
A person registered for VAT voluntarily may submit a deregistration request at any time, provided that turnover remains below the minimum registration threshold.
References:
- Decree No. 7549 concerning the obligations of taxable persons in relation to registration and deregistration.
- Decision No. 453/1 dated 22 April 2009, concerning the detailed application of Law No. 44 (Tax Procedures Law).
Deadline for Submitting a Deregistration Request
First: Mandatory Registration
| Reason for the Deregistration Request | Deadline |
|---|---|
| Turnover has fallen below the registration threshold | Two months from the end of the calendar year following the year in which turnover decreased. |
| Cessation of taxable activities | Two months from the end of the calendar year following the year in which the taxable activity ceased. |
Second: Voluntary Registration
A person registered for VAT voluntarily may submit a deregistration request at any time, provided that turnover remains below the minimum registration threshold.
Reference: Decree No. 7549 dated 7 March 2002 concerning the obligations of taxable persons in relation to registration and deregistration.
Required Form
The taxable person must complete Form Q2-1 .
Documents to Be Attached to the Deregistration Request
When Turnover Has Decreased
- Deregistration request, Form Q2-1.
- Quarterly details of turnover for the previous four years.
- Quarterly trial balances for the previous four years.
- Income tax returns for the previous four years.
When the Taxable Person Has Ceased Carrying Out Taxable Transactions
- Deregistration request, Form Q2-1.
- An official document confirming that the taxable person has ceased carrying out a taxable economic activity.
In the event of a permanent cessation of business, submitting Form M6 to the Income Tax Department is sufficient.
When Does Approval of the Deregistration Request Take Effect?
Approval of the deregistration request takes effect on the first day of the month following the month in which the taxable person is notified of the administration's approval.
Reference: Decree No. 7549 dated 7 March 2002 concerning the obligations of taxable persons in relation to registration and deregistration.
Administrative Processing Time
The transaction should be completed within 30 days from the date on which the deregistration request is submitted.
Important Note on Deregistration
VAT registration remains valid even after the deregistration request has been submitted. The taxable person must therefore continue calculating, declaring, and paying VAT to the Treasury until notified that the tax administration has approved the request.
The approval specifies the effective date of deregistration, meaning the date on which VAT collection and the exercise of the right to deduct must cease.
Reference: Decree No. 7549 concerning the obligations of taxable persons in relation to registration and deregistration.