Q&As

In the context of a TOGC, is it sufficient for a buyer to show they have made an application to HMRC for VAT registration or must the buyer already be VAT registered at the time of the transaction?

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Published on LexisPSL on 03/02/2016

The following Tax Q&A provides comprehensive and up to date legal information covering:

  • In the context of a TOGC, is it sufficient for a buyer to show they have made an application to HMRC for VAT registration or must the buyer already be VAT registered at the time of the transaction?

In the context of a TOGC, is it sufficient for a buyer to show they have made an application to HMRC for VAT registration or must the buyer already be VAT registered at the time of the transaction?

Assuming that the seller is a taxable person (eg is registered for VAT in the UK), the condition relating to the registration of the buyer for transfer of a going concern (TOGC) treatment requires that 'the transferee is already, or immediately becomes as a result of the transfer, a taxable person'.

A taxable person is defined as a person who is, or is required to be, registered for VAT under the Value Added Tax Act 1994 (VATA 1994).

As explained in Practice Note: VAT—what is a transfer of a business as a going concern?—Who has to be a taxable person and when?, in these circumstances, the buyer must:

  1. be accepted for

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