Transferring a VAT registration

The taxable turnover threshold that determines whether businesses should be registered for VAT is currently £85,000. The taxable turnover threshold that determines whether businesses can apply for deregistration is £83,000. The thresholds are currently frozen until 31 March 2026.

When there is a change of business ownership or legal status it is possible to transfer a VAT registration so that the new business will keep the same VAT number.

Businesses can apply for a VAT registration transfer online or by post. It usually takes three weeks for HMRC to confirm the transfer.

HMRC’s guidance states the following:

If you are selling your business:

• cancel your accountant’s access to your VAT online account - for example if you authorised them to deal with your VAT;
• cancel any direct debits on your VAT online account, and
• you must also give your records to the buyer if you are passing on your VAT number.

If you are buying a business:

• contact HMRC within 21 days of the transfer application if you want to keep the seller’s accountant,
• replace any self-billing arrangements with new ones, and
• set up new direct debits on your VAT online account.

Businesses may wish to start afresh and can opt to get a new VAT number. This will mean cancelling the existing VAT registration and re-registering for VAT. Whilst this requires additional paperwork it may be preferable as the VAT registration starts with a clean slate.