VAT registration ― artificial separation of business activities (disaggregation)

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance

VAT registration ― artificial separation of business activities (disaggregation)

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance
imgtext

This guidance note should be read in conjunction with the VAT registration ― compulsory guidance note and is relevant to persons established or resident in the UK. Persons that are not established or resident in the UK cannot benefit from the UK VAT registration threshold. This guidance note:

  1. explains what is meant by artificial separation of business activities

  2. explains what is meant by closely bound by financial, economic and organisational links

  3. explains what is meant by a Notice of Direction and the implications of a Notice being issued

  4. provides practical points to consider

For detailed commentary please refer to De Voil Indirect Tax Service V2.190C and V2.223.

What is artificial separation of business activities?

Artificial separation of business activities occurs when taxable business activities are artificially separated between two or more persons that are bound to one another by financial, economic, and organisational links. HMRC has statutory powers to challenge such arrangements and issue a Notice of Direction that the persons named in the

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
Powered by Tolley+

Popular Articles

Non-trading deficits on loan relationships

Non-trading deficits on loan relationshipsOverview of non-trading deficits (NTDs)When a company’s debits on its non-trading loan relationships and derivative contracts in an accounting period exceed the credits on its non-trading loan relationships and derivative contracts in the same period (the

14 Jul 2020 12:17 | Produced by Tolley Read more Read more

Self assessment ― estimates and provisional figures

Self assessment ― estimates and provisional figuresIf the taxpayer does not have sufficient information to enable them to complete the tax return in the time allowed, they should include either a best estimate or a provisional figure. The taxpayer should not either leave a box blank or enter

14 Jul 2020 13:37 | Produced by Tolley Read more Read more

Indexation allowance and rebasing

Indexation allowance and rebasingThis guidance note explains the general rules surrounding the availability of indexation allowance (which was frozen at December 2017) on the disposal of company assets and provides information on the rebasing rules for assets held on 31 March 1982. For an overview

14 Jul 2020 11:59 | Produced by Tolley Read more Read more