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In Haymarket Media Group Limited v HMRC [2022] TC08495, the First Tier Tribunal (FTT) found that the sale of TV studios to a property developer could not qualify as a Transfer of a Going Concern (TOGC) for VAT purposes. The vendor and buyer were not carrying on the same kind of business.

One of the conditions to be met for a valid TOGC is that the buyer must intend to use the transferred assets to carry on the same kind of business as the seller. 

The FTT dismissed Haymarket’s appeal, finding that:

Comment

While the VAT chargeable as a result of non-TOGC treatment was acknowledged as being Reclaimable as input VAT by Pinenorth, the FTT's decision meant that £680,000 of additional Stamp Duty Land Tax was due on the VAT element of the purchase consideration, which could not be reclaimed.

Useful guides on this topic

Transfer of a going concern (TOGC)
What is a TOGC? What conditions must be met? What are the consequences of a TOGC? What case law is there? 

Opting to tax land and property
What is an option to tax? What do I need to do to opt to tax? What happens if I buy an opted property?

Groups (VAT)
What are the conditions for forming a VAT group? What rules apply once a VAT group is in place?

Transfer of a Going Concern (TOGC): Properties
This is a freeview 'At a glance' guide to TOGCs and properties. 

Buy-to-lets & VAT
Buy-to-lets and VAT: when can VAT be recovered in respect of buy-to-lets? What are the conditions? Are there limits?

External link

Haymarket Media Group Limited v HMRC [2022] TC08495


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