VAT—consequences of a transfer of a going concern

Copyright © 2025 LexisNexis
Published by a LexisNexis Tax expert
Practice notes

VAT—consequences of a transfer of a going concern

Copyright © 2025 LexisNexis

Published by a LexisNexis Tax expert

Practice notes
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The conditions for a transfer of a business to be treated as a transfer of a going concern (a TOGC) are set out in Practice Note: VAT—what is a transfer of a business as a going concern?

Broadly if a transfer of a business is a TOGC it is treated as a ‘nothing’ for value added tax (VAT) purposes because a supply does not take place. However, even though this is the case, there are still a number of consequences which need to be borne in mind when providing advice in relation to a TOGC.

This Practice Note deals with the consequences for the buyer (transferee) and seller (transferor) of a transfer of a business:

  1. •

    being correctly treated as a TOGC, and

  2. •

    being incorrectly treated (or not treated) as a TOGC

This Practice Note includes references to EU case law. The UK ceased to be an EU Member State on 31 January 2020. On this date, the UK entered an implementation period (IP), during which it continued to be treated as

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Supply definition
What does Supply mean?

The Value Added Tax Act 1994, s.5(2)(a) provides that supply "includes all forms of supply".

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