Common areas of difficulty: reallocation of VAT number
Under Regulation 6 VAT Regulations 1995, subject to certain conditions the VAT number of the seller may be reallocated to the purchaser (VAT 68 procedure). This has the effect of making the purchaser responsible for the debts and liabilities of the seller. Where the VAT number has not been so reallocated, this is not the case, even where the seller and purchaser are closely associated, for example with common directors. Further guidance on the procedural aspects of VAT 68 action is contained in guidance V1-28: Registration and a useful summary of implications and consequences are in Notice 700/9 Transfer of a businessas a going concern.