I’ve searches but can’t find an answer.
ABC Corp incorporates and starts business
Invests £10k in marketing and claims 2k input
invests £10k in product stock and claims 2k input
sells 5k of services and charges 500 output
something catastrophic happens after x years (loss of patent, directors fall ill, whatever). Company is to be dissolved. They deregister for VAT, at which point they “owe” HMRC £3.5k
Do they need to pay this back? HMRC will effectively have donated 3.5k in cheques to ABC corp