3. Election to be an accountable person and cancellation of such election

(1) In this Regulation—

“application form” means such form as is provided by the Commissioners for the purpose of enabling a person to apply to elect to be an accountable person;

“end-date” means the last day of the taxable period immediately preceding the request period;

“relevant taxable periods” means the taxable periods comprised in whichever of the periods referred to in paragraph (5)(b)(i) is appropriate;

“request period” means the taxable period during which a person notifies the Commissioners that he or she requests the cancellation of an election;

“start-date” means—

(a) in the case of an accountable person referred to in paragraph (4)(b), the date that person was first treated as an accountable person,

(b) by agreement between the person concerned and the Commissioners, the beginning of the taxable period during which the application form is received by the Commissioners, or

(c) in any other case, the beginning of the taxable period immediately following the taxable period during which the application form is received by the Commissioners.

(2) A person who, in accordance with section 6(1) of the Act, is not an accountable person but who wishes to elect to be such a person is required to register for tax by completing the application form.

(3) The submission of the application form referred to in paragraph (2) constitutes an election to be an accountable person. Such election is effective from the start-date until the date the election is cancelled in accordance with paragraph (7).

(4) (a) A person who is an accountable person by reason only of an election made in accordance with paragraphs (2) and (3) is entitled to have such election cancelled, subject to fulfilling the requirements of paragraph (5).

(b) An accountable person who satisfies the Commissioners that, in accordance with section 7 of the Act, he or she may be treated as a person who is not an accountable person is entitled to have his or her registration as an accountable person cancelled, subject to fulfilling the requirements of paragraph (5).

(5) A person who wishes to have his or her election cancelled is required to—

(a) apply to the Commissioners in writing to have his or her election cancelled,

(b) furnish particulars to the Commissioners of—

(i) the total amount of tax paid by him or her in accordance with sections 76 and 77 of the Act on the supply by him or her of goods or services, other than services consisting of the letting of immovable goods referred to in paragraph 11 of Schedule 3 to the Act, in respect of whichever of the following periods is the shorter:

(I) all the taxable periods comprised in the period commencing with the start-date and ending with the end-date, or

(II) the 18 consecutive taxable periods up to the end-date,

(ii) the total amount of tax refunded to him or her in accordance with section 99(1) of the Act in respect of tax borne or paid in relation to the supply by him or her of goods or services, other than services consisting of the letting of immovable goods referred to in paragraph 11 of Schedule 3 to the Act, in respect of the relevant taxable periods, and

(iii) the tax deductible under Chapter 1 of Part 8 of the Act in respect of the intra-Community acquisition of goods, if any, made by him or her in the same relevant taxable periods,

and

(c) furnish a return in accordance with sections 76 and 77 of the Act for the request period, and at the same time pay to the Collector-General—

(i) any tax payable in respect of goods and services supplied by him or her during the request period, and

(ii) an amount equal to the excess (if any) of the sum of the tax referred to in clauses (ii) and (iii) of subparagraph (b) over the tax referred to in clause (i) of that subparagraph;

but, if that person supplied qualifying goods and services in accordance with section 56 of the Act during the relevant taxable periods, he or she may include in the amount referred to in subparagraph (b)(i) the tax that would have been chargeable had the supplies not been zero-rated under that section.

(6) Where a person who supplies services consisting of the letting of immovable goods referred to in paragraph 11 of Schedule 3 to the Act wishes to have his or her election cancelled, he or she is required to—

(a) apply to the Commissioners in writing to have his or her election cancelled, and

(b) furnish a return in accordance with sections 76 and 77 of the Act, and at the same time pay to the Collector-General—

(i) any tax payable in respect of those services supplied during the request period, and

(ii) the cancellation amount provided for in section 8(2) of the Act, as if it were tax due in accordance with Chapter 3 of Part 9 of the Act, in addition to any amount payable in accordance with section 8(1) of the Act.

(7) Where the Commissioners are satisfied that the requirements of paragraph (5) and, where appropriate, paragraph (6) are fulfilled by the person concerned, they shall—

(a) notify that person in writing accordingly, and

(b) cancel that person’s election to be an accountable person with effect from the end of the taxable period during which those requirements have been fulfilled.

(8) A person who requests the cancellation of his or her election to be an accountable person is not entitled, under section 99(1) of the Act, to any refund of tax, other than a refund referable solely to an error or mistake made by him or her, for the request period or any subsequent taxable periods in excess of an amount calculated in accordance with the following formula:

A + B

where—

A is the excess of the amount referred to in clause (i) of paragraph (5)(b) over the sum of the amounts referred to in clauses (ii) and (iii) of that paragraph but, where there is no such excess, A is equal to zero, and

B is the sum of the amounts of tax paid under sections 76 and 77 of the Act for the request period and any subsequent taxable periods until the election is cancelled.

(9) In the case of a farmer who, had he or she made no election to be an accountable person, would not be an accountable person by virtue of section 6(1)(a) of the Act, paragraph (5)(b)(i) applies as if—

(a) the amount of tax paid by him or her in accordance with sections 76 and 77 of the Act in respect of each of the relevant taxable periods were increased by an amount equal to the flat-rate addition, which that farmer would be required (in accordance with section 86(1) of the Act) to indicate on an invoice in respect of the supply of agricultural produce or of an agricultural service if that farmer had not elected to be an accountable person, and

(b) the total amount of tax refunded to him or her in respect of all the relevant taxable periods comprised in the period included in the calculation in paragraph (5)(b)(i) were reduced by the total amount of

tax which qualified for deduction under Chapter 1 of Part 8 of the Act in respect of those taxable periods and which, in accordance with any order made under section 103 of the Act, would fall to be refunded to him or her if he or she were not an accountable person.