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TOGC on business purchase

Later business wants to de-register from VAT

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Good morning AW,

A new limited company buys a trading business, with both the seller and buyer being VAT registered, as a result the purchase qualifed for TOGC. If the buyer later decides that they would like to de-register the business (as a result of a drop in turnover) - Is there an implication that the initial VAT sum on the purchase, that would have been payable (if the purchase did not qualify as a TOGC) would be payable upon de-registration?

Any advice much appreciated, thank you

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By lionofludesch
19th Sep 2019 09:44

Yes. He'll have to pay VAT on the value of the relevant assets at the time of deregistration, subject to de minimis.

It's not a matter of repaying input tax he's claimed on the purchase. It's about output tax at the time of deregistration.

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By Clinton Lee
19th Sep 2019 11:53
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