Although with a VAT68 there is legally a new VAT registration, albeit, with the previous entity’s VAT number, HMRC’s manual reference FRS4500 states that where there is a transfer of a going concern (TOGC) with a VAT68, FRS treatment will continue unless the transferee requests otherwise. This implies that the original joining date remains the anniversary, and this is what we would advise, subject to the acknowledgment letter sent by HMRC not saying anything to the contrary.
We are often asked about the 1% discount in where there is a change of entity. This specific point is not addressed in the manuals, but Notice 733 states in paragraph 4.7 that ‘If your business is a transfer of a going concern you will be entitled to apply the 1% reduction from the date of the transfer.’ As the Notice makes no distinction between a TOGC from an unconnected party, and a change of entity, and no distinction between a TOGC with a new VAT number and one with a reallocated number it would be reasonable to draw the conclusion that HMRC’s policy is to allow the reduction in all cases.
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