ACCA · Question 20 · Value Added Tax (VAT)
Section B: Case 1 - Vanguard Robotics
Scenario: Vanguard Robotics was run as a sole trade by Liam, developing specialized robotic arms for manufacturing. Liam prepared accounts to 31 December each year. On 30 September 2023, Liam ceased trading as a sole trader and transferred the entire business as a going concern to a newly formed company, Vanguard Robotics Ltd, in exchange for shares.
Question: Liam was registered for VAT as a sole trader. Vanguard Robotics Ltd will continue the same type of business. Which of the following conditions is NOT required for the transfer to be treated as a Transfer of a Going Concern (TOGC) for VAT purposes?
Answer options:
The assets must be used by Vanguard Robotics Ltd in carrying on the same kind of business.
Vanguard Robotics Ltd must be VAT registered or immediately become liable to be registered.
Vanguard Robotics Ltd must retain Liam's original VAT registration number.
There must be no significant break in the trading of the business.
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