Value Added Tax Consolidation Act 2010 section 8

Cancellation of election

Section 8 sets out the rules for cancelling a voluntary election to register for VAT, including the calculation of any clawback amounts payable to Revenue on cancellation.

• A person who elected to register for VAT may apply to cancel that election, but must repay any net VAT refunded during the election period or the preceding three years, whichever is shorter
• The basic clawback is calculated as (A + B) − C, where A is VAT refunded on supplies (excluding holiday lettings), B is VAT deductible on intra-Community acquisitions, and C is net VAT paid on those supplies
• A separate regime applies to persons who elected to register in respect of holiday accommodation lettings, requiring payment of a property-based cancellation amount calculated over a ten-year adjustment period
• The holiday accommodation cancellation rules apply only to properties acquired or developed before 1 July 2008; properties acquired on or after that date fall under the capital goods scheme instead