Transfers of going concerns (TOGCs): reallocation of VAT registration number (VAT 68 action): responsibilities of the transferor
Once reallocation has been granted, enforcement action cannot be taken against the transferor for VAT debts (that is, outstanding returns) transferred to the transferee.
The transferor remains liable for their conduct during periods before the transfer and may be assessed for penalties arising from their conduct during those periods which comes to light after the transfer. This will include a misdeclaration penalty (VAT Act 1994, section 63) or a repeated misdeclaration penalty (VAT Act 1994, section 64) following an incorrect return submitted by the transferor. (The tax assessment and related interest will be assessed against the transferee).
A misdeclaration penalty would only be assessed against the transferor in this situation in very limited circumstances where, for example, there was serious non-compliance prior to the TOGC and the same person was involved in running the business after the TOGC.