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Why is VAT recovery an issue when there is a TOGC?

As described in the TOGC ― overview guidance note, a TOGC is neither a supply of goods nor services and is therefore outside the scope of VAT. This raises questions over how to treat any VAT on costs associated with the TOGC.

The treatment of VAT on costs differs slightly for the seller (transferor) and the purchaser (transferee). The position for each is considered in this guidance note.

What kinds of costs are associated with a TOGC?

There are often costs associated with a TOGC, common examples of such costs include:

1. •

   solicitors’ fees

2. •

   estate agents’ costs

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