VAT no when changing from Partnership to Ltd Co

[Benson]

Just wondering if anyone can point me in the right direction, ive been advised differently by 2 accountants so a bit confused.

1 says that I should change my vat number when going from a partnership to a Ltd company as in close the partnership down and reopen as a Ltd co

The other one says to keep the vat number for ease and continuity

Not sure if the 2nd one is saying it to make it less work?

Anyone got any advice?

[Indizine]

The vat man told me that if I have more than one business that my one registration is linked to me the person as such, so my vat reg covers all my businesses. regardless...in that I cant have one charging vat and another not charging vat.

[Nilesh Mandvia]

The Advice from both accountant is correct.

When you sell your business as going concern (from partnership to ltd company is sale of a business as going concern as ltd is separate legal entity)

• New business owner apply for new vat number or
• in some situations, the new owner of your business can apply to keep your VAT registration number. If you agree to this, then you don't need to cancel your registration. Instead, both you and the new owner of your business should complete form VAT 68 and send it to HMRC.

Both has their own advantage and disadvantage. So discuss with your accountant who should go through and advise which is best option for you.

HTH

[Big Pete]

The Ltd Company becomes a seperate entity and as such needs seperate new VAT number...

The good looking blonde was also correct as being a sole trader it is the person carrying the VAT number so that number is used on all her business sales etc...

[Indizine]

....but the not so good looking blonde is a Ltd Co not a sole trader to whome the vat man gave this advice

[James Smith]

The vat man told me that if I have more than one business that my one registration is linked to me the person as such, so my vat reg covers all my businesses. regardless...in that I cant have one charging vat and another not charging vat.

That's not actually strictly true. You cant artificially split your business so you have (say) VAT registered customers in a limited company you control that is VAT registered and non-VAT registered customers in a sole trade that is not VAT registered carrying our roughly the same trade, but you can have business A in a VAT registered limited company , and business B as a sole trade that is not VAT registered, SO LONG as they are completely different businesses. Eg one is (say) an estate agents and one an ebay trader selling socks.

Nilesh has of course got the right answer - you can do both. Depends on the circumstances which you would chose. Several factors here.

[Benson]

Is there anywhere that points out the advantages and disadvantages for this?

Both accountants are adamant they are best informing me so not sure which way to go

Basically we are a partnership going to a limited company and hence the partnership will be no longer if that makes a difference?

[James Smith]

Well its not uncommon for two accountants to disagree - but you would have thought they would be able to explain why their decision is - in their opinion - the better one although its really not a big deal either way.

I would suggest the one who actually acts for you would be on the best position to advise. Not sure how you have ended up with two who know your business inside out and are able to offer proper advice? Perhaps you are changing firms? If so I would go with the new person if you are swapping as they will have to deal with it ongoing.

One issue is probably incorporation and how you are treating it, ie as a going concern (in which case you would transfer the number) or as "bits" in order to get tax relief on the goodwill (in which case you probably wouldn't transfer) Other trading issues might also come into the mix but its very hard to say not being your advisor.

Fundamentally ask them! If they cant explain then they probably are not much good.

Regards,

[consultant]

James is right, get the advice from your advisor.

For my ha'penth worth, unless there is a reason why you would want to start all over, as you are just changing the structure of the business, assuming all other bits remain the same, stay with thr VAT number you have.