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HMRC internal manual

VAT Groups

From
HM Revenue & Customs
Updated
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Applications for VAT group treatment: process for refusal of applications

If, having made all the enquiries that we consider are necessary we decide that the application should be refused; we would advise the trader in writing. If the application was to include a body corporate in a VAT group, the applicant will then be removed from the group with effect from the date on which the application was received. VAT Act 1994, section 43B(6) states that, in such circumstances, the applicant is treated as never having been a member of the group. If the application is for two or more persons to form a new group registration and we conclude that the application should be refused in its entirety, then the group is treated as if it had never existed.

If an applicant was registered in its own right when it applied for grouping, and that application is refused, we will need to reinstate its previous registration number (and if the refusal involves a number of applicants, each one’s previous registration number will need to be reinstated). If the applicant was not registered at the time of application for grouping, they may be required to notify a liability to register.

If we decide that an application is to be refused where we have allowed a period of retrospection, the application will be refused with effect from the retrospective date on which it was originally given effect.