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HMRC internal manual

VAT Groups

VAT groups - protection of the Revenue: procedure for applying the revenue protection powers

If you consider that it might be necessary to exercise your powers for the protection of the revenue, a pre-warning that a submission is likely should be sent to VAT policy team responsible for VAT grouping, that way we are able to ensure that someone is available to review it promptly.

Then you should write and tell the applicant that you are making further enquiries. This should be done within fifteen working days of receipt of the application. You should ask at this stage if there is any other information that they want you to consider when making the decision; for example, the structure adopted by the business may have been imposed on them by other legislation.

You should at this stage get your recommended action to the VAT deduction and Financial Services team, so that we have as much consideration time as possible.

If during the course of your enquiries, you are not satisfied that you have sufficient information, you should contact the companies in question to get further information to allow you to make a properly considered decision.

Officers need to ensure that the reasons given in support of the application are genuine. If you consider the reasons given for wanting group treatment are not tenable or vague, you should contact the trader to question them - keeping comprehensive notes of any telephone conversations.

You should reach a balance between placing burdens on business by asking for prompt responses with the need to complete the enquiries within the timeframe. Follow up action must be undertaken promptly so that we are in a better position to defend our exercise of the revenue protection powers before the courts, should that prove necessary.