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HMRC internal manual

VAT Registration

From
HM Revenue & Customs
Updated
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Transfers of going concerns (TOGC): what is a TOGC?

A TOGC takes place when the assets of any business are transferred from one person (transferor) to another (transferee).

The following are some examples:

  • the assets are bought by another person and the existing business ceases to trade
  • part of a business (capable of separate operation) is sold to another person
  • the existing owner dies or retires and the business assets are taken over by another person
  • the assets are transferred to a new legal entity. For example, a sole proprietor becomes a partnership, or a partnership becomes a limited company.

The business may be making taxable and/or exempt supplies and it need not be VAT-registered, but it must be capable of separate operation: in other words, it must be a going concern.

Further guidance on what constitutes a TOGC can be found in VTOGC and further advice in these cases can be sought from the Supply policy team. (External users can access the TOGC manual at http://www.hmrc.gov.uk/manuals/vtogcmanual/index.htm).

Guidance on TOGCs involving divisional registrations is in the Groups and Divisions guidance.

When there is a transfer of shares in a limited company from one person to another, the assets still belong to the limited company. There is no change in the ownership of the assets so there is no TOGC.