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TOGC Vat registration /2 business activities

Can TOGC rules work for sole two with two businesses

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Clients farm business is to become a partnership(vat registration to continue) with the sub-contracting business continuing but not registered for vat. 

Can the TOGC rules apply to transfer the assets of the farm only thus saving on the output vat as assets will be approx £15k on date of transfer.

Will the sub-contracting business activity still transfer onto the new vat certificate? , which we don’t want.

We simply need the farm under the new legal entity to be vat registered whilst having no vat paid out on assets.

Assets claimed on the subcontracting accounts will be below £5k nett threshold so no vat.

Or do we simply do Vat 7 form/ cancel the Vat registration for sole trader and his business interests and do Vat 1 for the new partnership/new vat number. (Sell the asset to farm partnership and claim back the vat ?? , is this allowed??)


  Some guidance would be appreciated 





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22nd May 2018 08:17

The TOGC rules can apply to part of a business, which is a going concern on its own.
But if the transferee is not registered for VAT, the sale reverts to taxable, as the TOGC rules do not then apply.

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22nd May 2018 09:31

Agree with Les.

The new business needs to be registered as a condition of a TOGC so the idea is a non-starter.

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22nd May 2018 22:16

Thanks folks,

So the only way is to de-register the taxable person and obtain new vat registration for farm partnership.

Any bright sparks on how I can minimise the output vat on de-registration?

(my thoughts:- farm sole trader ceases entirely / could we sell the machinery to the new partnership before de-reg date / pay over the vat/ partnership in turn can recover the input vat down the line / tax implications of sole trader (balancing charges) however these can be nullified through the tax saving in the partnership / basic tax payers) Would HMRC see this as avoidance mechanism ?


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