HMRC: change in policy regarding TOGCs
Following the case of Robinson Family Ltd v HMRC, HM Revenue & Customs have been forced to retreat from their long standing position that the grant of an overriding lease does not amount to a transfer of a going concern.
The case of Robinson Family Ltd v HMRC has determined that for VAT purposes a TOGC did occur when the claimant sold, by way of a sub-lease, its interest in property. The key points of the case are:
- The court must look at the substance rather than the form of the transaction.
- Where the transferee is effectively carrying on exactly the same business as the transferor then prima facie, the TOGC provisions should apply.
Professional advisers have been arguing that HMRC have been getting this point wrong for years. It is generally thought that their stubborn stance has been born out of a fear of increased VAT avoidance. Given the wealth of anti-avoidance legislation and case law it is difficult to understand exactly what they were scared of…
If you are registered and logged in to the site, click on the link below to read the rest of the Nabarro briefing. If not, please register or sign in with your details below.
Click on the link above to download briefing.
News from Nabarro
Briefings from Nabarro
The ABI has issued guidance on lock-up agreements, in particular in response to concerns over the extent to which lock-ups are waived during the lock-up periods.
Nabarro partner Martin McKervey shares his thoughts on unlocking export growth.
Analysis from The Lawyer
Clients are more willing to bring claims against professional service providers but the risk to defendants is not as dramatic as it might seem
Real estate continues to be the key money spinner for Nabarro, which has always been known for its work in the UK property market, (although) last year results were up across the firm. Google’s ...