VATREG29300 - Transfers of going concerns (TOGC): VAT registration: requirements

This guidance relates to businesses which are being carried on by a taxable person being transferred to another person as a going concern and the registration status of both transferor (seller) and transferee (buyer).

For there to be a TOGC, if the seller is a taxable person, the buyer must be one of the following:

·         registered for VAT

·         required to be registered at the date of the transfer because all of the conditions for compulsory registration are met

·         accepted for voluntary registration, which must be in place at the time that the transfer occurs. Requests for backdated voluntary registration will not be considered.

The seller need not have been a taxable person for any particular length of time, they simply have to be a taxable person when the TOGC occurs.

If the seller is not a taxable person at the time of the transfer, the buyer will not be deemed to have carried on the business prior to the transfer and the seller’s turnover is not required to be considered towards the registration threshold of the buyer.

If the seller is a taxable person but the buyer is not and does not become one once the transfer takes place, then there is no supply or TOGC for VAT purposes. For example, if a seller sells part of his business which does not meet the current VAT threshold, the buyer need not register.