V2.131 Transfer of registration following a TOGC
Regulations1 made under VATA 1994, s 49 provide that, where a business (or part thereof2) is transferred as a going concern ('TOGC'), HMRC may, from the date of the transfer, cancel the transferor's registration and register the transferee with the registration number previously allocated to the transferor.
It is a condition that, on the transfer of the business, the transferor's registration is to be cancelled and has not already been cancelled3. It is also a condition that, on the transfer of the business, either4:
• the transferee becomes liable to be registered (see V2.137 and V2.158)5
• HMRC agrees to register him (see V2.144 and V2.146)6
Although not a legal condition, HMRC takes the view that the transferor must have no VAT debt for the VAT68 procedure to apply. This includes amounts declared (both due or not yet due), penalties and other applied charges7.
An application is made on the prescribed form (Form VAT 68) by or on behalf of both the transferor and transferee8. In Ruttle Plant (Midlands) Ltd it was found to be immaterial that the forms may be subsequently lost by HMRC, so long as it is clear that they were duly completed and received9.