Transfer VAT no to Ltd co

Transfer VAT no to Ltd co

Didn't find your answer?

Have hacked my way into the VAT advice line yesterday, I was told that all I needed to do in place of the paper VAT 1 and VAT 68 was to apply for VAT regn online as agent for Ltd co. (Client now sole trader, and wishes to transfer VAT no to ltd co of which he is sole director).

Having ploughed my way through the VAT application and received an acknowledgement this morning, I had another look at the website ("it's all on our website"). I found it very confusing. It looked as if sole trader does need to close his scheme separately.

So once again I tried lots of forms of words to get through to someone on the VAT helpline. He said VAT 68 does need to be completed. He checked with 2 other colleagues but didn't seem absolutely clear. He advised me to send paper VAT 68 with a copy of the acknowledgement I got for the VAT 1.

Do you agree that's all we need to do?

I further asked whether, having entered the date of 1 Feb 2014 for this to start, if client can actually use the old VAT no from that date, bearing in mind postal backlogs if we send paper VAT 68. HMRC person said he thought so, but sounded rather vague.

I am sure there are some experts on AWeb who have some good recent experience. Help please!

Replies (6)

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chips_at_mattersey
By Les Howard
22nd Jan 2014 11:10

VAT 68 - retaining VAT Registration Number

You are not obliged to retain the VRN from the Sole Trader. My usual approach is not to do so. The reason is simply that any Default Surcharges would be carried over. In contrast, if you deregister the Sole Trader and register the limited company with a new number, any previous defaults do not count. (Of course, if you are happy with the present position, then you can retain the number.)

And, yes, you do need to complete a VAT 1 either way. You should be able to do this online as agent.

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Stepurhan
By stepurhan
22nd Jan 2014 11:42

Love the summary

"HMRC advice line not reliable", also sun not cold and sky not yellow, green and purple spirals. :-P

Did the online system have the equivalent of questions 9 to 12 on the paper form? If so, what did you answer to those questions and did they tell you anything else you needed to do? Stuck to the paper forms for recent registrations (signed client approval) so not sure on what the online system covers.

I would still expect you to need to complete a form VAT68 to transfer the number. This almost certainly cannot be done online, as it requires the approval of both the buyer and the seller (same in this case but this won't usually be so).

I would say that, until you get a new registration certificate confirming the transfer, you probably should not use the old number. The position is equivalent to an entirely new registration from the company point of view. I'd have advised pushing back the start date to accommodate this, but it is already too late for that. Subject to answers to questions 9 to 12 above, it is possible you will end up with a new number anyway.

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Euan's picture
By Euan MacLennan
22nd Jan 2014 13:28

Change of legal entity

The online VAT application asks for the reason for registration.  If you select "Change of legal entity" from the drop down list, it will then ask you when the change took place and whether you wish to keep the existing VAT registration number; if you say "Yes", it then asks for the existing number. That is all there is to it.  No separate VAT68.  Could not be simpler - provided you select "Change of legal entity", which is perhaps not the first option that comes to mind.

Thanks (2)
By Moonbeam
22nd Jan 2014 13:39

Thanks Euan

The first person I spoke to at HMRC advised what you are saying and I did indeed select change of legal entity as that is what is happening, giving all information requested.

It just isn't clear on HMRC's website and clearly a problem for some of their staff.

I don't do this procedure very often but do expect HMRC to be able to tell me how to use their current systems.

I shall abandon the paper VAT 68 in that case.

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Stepurhan
By stepurhan
22nd Jan 2014 13:57

Sensible HMRC ?

An online form recognising businesses changing their legal entity might wish to keep their VAT number. That almost seems......sensible. Are you sure that it was an HMRC form that said this?

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avatar
By mwelbourne
15th Jan 2015 13:19

It does work

I recently changed my business from a partnership to a sole trader, applied for a new VAT reg and then transferred my existing number, and all this happened online - and, yes, it did seem surprisingly easy for the HMRC.

When I tried to do my first VAT return for the new entity it didn't work so I did have to ring the helpline and all I needed to do was log in on the old business and somewhere in the VAT online section you can tick a box to say that the reg number is no longer active or linked to that business (can't remember the exact wording). It never made this clear during setup. Once I did that and logged back into the new business it worked fine.

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