Hi, I am a VAT Consultant, working mainly with charities. I am based in Cambridgeshire
I have over 20 years experience in VAT, and am currently also a part-time member of the Tax Tribunals.
Are you asking whether you should refund customers VAT 'charged' after deregistration? I wonder if it is an ethical question, not a VAT question?
What will they do in the property? Do they need to opt to tax to recover the input tax?
If you hold an opted property at deregistration, there is a deemed supply, ie: an irrecoverable VAT cost.
I would not ask HMRC. Rather agree between both parties. The landlord will want some guarantee that the charity will not alter its stated uses.
What is the buyer intending to do with the building?
And, get professional advice.
If the charity runs its business and non-business activities in discrete parts of the building, then the option to tax can be disapplied for the non-business areas.
You can re-register for VAT. And, assuming you were properly deregistered, HMRC cannot assess you for output tax for the intervening period.
And no you cannot use the FRS.
The value of TOMS supplies is the margin achieved. So, if the client buys in all he services (Accommodation, catering, tour guides, etc) then just look at the profit.
For in-house supplies, normal valuation rules apply.
Send email to HMRC requesting applying for Repayment Supplement.
My rule-of-thumb: if you have to ask that question then there is a risk of HMRC taking action under their disaggregation powers.
You chief counter-argument is that John started as a PT and then added the gym business later. This would prevent an argument that there is artificial separation. But it is not so good if HMRC argue that there is, in reality a single business.