Transfer of employer registration to limited co on incorporation

Transfer of employer registration to limited co...

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Self employed client has employees and he has recently set up a limited company with the view of transferring trade in April 2010.

Obviously one can apply to transfer the VAT registration to the limited company following the TOGC.  Although looking at the forms it appears that it has to be done after the transfer so does one just carry on with the VAT number in the meantime assuming the application will be accepted?

Can the employer registration be transferred in a similar way or does a new registration have to be applied for?

If someone can point me in the right direction, I'd be grateful.  Thank you.

Replies (6)

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By occca
19th Jan 2010 17:36

Simple answer - No

They are seperate legal entities and therefore you must P45 all employees and set them under the limited company scheme

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Euan's picture
By Euan MacLennan
19th Jan 2010 17:41

No & No

No - you cannot transfer the VAT registration.  You have to apply online or on form VAT1 for the company to be registered from April.  What you can transfer is the registration number using form VAT68.

No - you cannot transfer the PAYE registration.  You have to apply online or by telephone for a PAYE scheme for the company and it will always have a different reference to the PAYE scheme for the sole trader.  What you can do is inform the PAYE district that you are treating the transfer of all the employees as a succession and provided that the Revenue accepts this, you will not have to raise forms P45 and in the company's forms P35 & P14/60 at the end of 2010/11, you will show the pay and tax figures for the employment by the sole trader together with the figures for the company as "This employment" and not separately as "previous employment".

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Giraffe
By Luke
19th Jan 2010 19:33

Thank you both for your clarification.

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By geoffwolf
19th Jan 2010 22:41

for length of service purposes

if that were ever needed  the commencement date of continuing employees is the date they were started employment with the sole trader.

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By DMGbus
20th Jan 2010 09:06

HMRC webpage...

http://www.hmrc.gov.uk/manuals/pommanual/PAYE30045.htm

When you are notified that a business has changed hands it is important that you establish whether a true succession has taken place. 

Regulations 102 to 104 of the Income Tax (Pay As You Earn) Regulations 2003 confirm how successions take place for PAYE purposes.

Regulation 102 applies where there is a change of employer but the employee remains in employment in the same business, and it means the new owner can take over the operation of PAYE without completion of forms P45. The old employer remains responsible for any tax due on payments he makes, but the new employer completes the end of year returns for the whole year.

A succession can only take place if the old and new employer agree to it. If the old employer issues forms P45 and closes down the existing PAYE scheme, then HMRC must open a new scheme for the new employer. Likewise, if the new owner continues an existing business but does not want to assume responsibility for the period up to the date of the change then no succession has taken place.

It is quite easy to mistake a change in circumstances as a succession, but an employer succession arises only where:

The ownership of a business changes from one legal entity to another; andThe new owner takes responsibility for the pay records of the old employer.

Both conditions must be satisfied before it is considered that an employer succession has taken place and you should confirm this.

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Giraffe
By Luke
20th Jan 2010 11:22

Thank you

Thanks you very much for the further comments.

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