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Transfer of going concern

24 February 2015
Issue: 4490 / Categories: Tax cases , VAT

CRC v Royal College of Paediatrics and Child Health; Coleridge (Theobalds Road) Ltd, Upper Tribunal

The Royal College of Paediatrics and Child Health (RCPCH) decided to buy new premises from Coleridge a property development company. The British Association of Perinatal Medicine (BAPM) which rented space from the college wished to move to the new premises as a tenant.

It was decided to make the sale VAT-efficient by arranging it as a transfer of a going concern to which end Coleridge and BAPM entered into an agreement for a lease for a single room conditional on the property developer exchanging an unconditional sales contract with RCPCH.

HMRC said VAT was due because the deal did not amount to a transfer of a going concern.

The First-tier Tribunal allowed the taxpayer’s appeal holding there was a transfer of a going concern of a property business and finding the Revenue’s assessment was time-barred.

The tax department appealed.

Mr Justice Birss in the...

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