TOGC ― overview

By Tolley
TOGC ― overview

The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • TOGC ― overview
  • What is a transfer of a business as a going concern?
  • What are the conditions for a transfer of a business as a going concern?
  • What needs to be considered when transferring land and property as part of a transfer of a business as a going concern?
  • How does a transfer of a business as a going concern impact on VAT recovery?
  • What other VAT issues can arise out of the transfer of a business as a going concern?
  • Practical points ― transfer of a business as a going concern

This guidance note provides an overview of the transfer of a business as a going concern (TOGC).

In-depth commentary on the legislation and case law can be found in De Voil Indirect Tax Service V2.226.

What is a transfer of a business as a going concern?

The default position for the sale of business assets by a business which is registered for VAT or required to be registered for VAT (see the Overview ― registering for VAT guidance note) is that it will be subject to VAT at the appropriate rate for the assets in question. However, the sale of assets as part of a business which is a ‘going concern’ will be treated as neither a supply of goods nor a supply of services for VAT purposes provided certain conditions are met. This means that a TOGC is outside the scope of VAT and no VAT is charged.

SI 1995/1268, Article 5

The TOGC treatment is mandatory which means that if the relevant conditions are met, t

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