Readers’ forum: Cash accounting scheme and group registration

One of my clients was a member of a three-company VAT group which used the cash accounting scheme for VAT.

By mutual agreement my client left the group and is now registered for VAT as a stand-alone company – the date of registration was the day after leaving the group.

Due to cash flow issues – paying creditors slowly – my client has not adopted the cash accounting scheme with the new registration.

However I have just discovered that my client did not account for output tax – either through the group registration or current registration – on closing debtors of £80 000 plus VAT on the date it left the group.

My question is whether the group registration should have accounted for output tax on these sales on the day my client left the group – as the sales invoices in question showed the group’s VAT number...