Commentary

V2.137 Liability to registration when business transferred as a going concern

Part V2 Registration – deregistration

V2.137 Liability to registration when business transferred as a going concern

V2.137 Liability to registration when business transferred as a going concern

Liability to register when a business is transferred as a going concern due to historical turnover

A person ('the transferee') who is not registered becomes liable to registration when a business (or part thereof) is transferred to him as a going concern if both of the following apply1:

  1.  

    •     the person who carried on the business prior to the transfer ('the transferor') is a taxable person, and

  2.  

    •     the value of the transferee's taxable supplies in the period of one year ending at the time of transfer has exceeded the prescribed registration limit (currently £85,0002, see V2.134 for future changes and see 'UK taxable supplies—deregistration' in Tax tables and checklists for past prescribed limits).

The transferee is treated as having carried on the business before as well as after the transfer for this purpose and supplies by the transferor are treated accordingly3. The transferee is therefore liable to registration by

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