Holding companies ― VAT grouping

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note looks at the effect of VAT grouping a holding company with its subsidiaries.

For an overview of VAT and holding companies generally, see the Holding companies ― overview guidance note.

For VAT grouping generally, see the VAT group and divisional registration ― overview guidance note.

How does VAT grouping impact a holding company’s entitlement to recover VAT?

Subject to meeting the conditions outlined in the VAT groups ― conditions guidance note, a holding company may join a VAT group. Even holding companies which do not have any trading (business) activities or which make only exempt supplies may be entitled to VAT group with their subsidiaries.

However, HMRC will not accept that joining a VAT group on its own will automatically give rise to an entitlement to VAT recovery.

HMRC has indicated that VAT grouping cannot change a non-economic activity into an economic activity (for the VAT status

Access this article and thousands of others like it
free for 7 days with a trial of TolleyGuidance.

TAKE A FREE TRIAL

Popular Articles

Personal Tax

Married couple’s allowance

Married couple’s allowanceThe married couple’s allowance (MCA) is only available if one of the two spouses or civil partners was born before 6 April 1935. This means that one member of the couple must be at least 89 years old on 5 April 2024 to qualify for an allowance in the 2023/24 tax year.There

14 Jul 2020 12:13 | Produced by Tolley Read more

Corporation Tax

Double tax relief

Double tax reliefWhen income arises in a foreign country to a UK resident company and that income is taxable in that foreign country, the UK may give the company relief for the foreign tax by crediting the foreign tax against the UK tax charged on that income. This might include withholding tax on

14 Jul 2020 11:31 | Produced by Tolley in association with Anne Fairpo Read more

Value Added Tax

VAT registration ― change of VAT registration details

VAT registration ― change of VAT registration detailsVAT registered persons must keep their VAT registration details up to date and notify HMRC of any changes. Failure to notify HMRC by the relevant time could result in a penalty. For guidance regarding penalties for failure to notify please see the

14 Jul 2020 13:57 | Produced by Tolley Read more

UU��ֱ��