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VAT groups ― main consequences and deciding whether to group

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance

VAT groups ― main consequences and deciding whether to group

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance
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This guidance note considers the main consequences that follow when persons come together to form a VAT group. It also considers the key advantages and disadvantages which flow from these consequences.

For an overview of VAT grouping an divisional registration generally, see the VAT group and divisional registration ― overview guidance note.

For in-depth commentary on the legislation and case law in this area, see De Voil Indirect Tax Service V2.189Z and V2.190.

Main consequences of VAT grouping

There are a wide variety of consequential and related implications when a decision is made to form a VAT group. However, the main implications are broadly as follows:

ImplicationDescription
Single representative memberThe group is registered in the name of a single ‘representative member’ (which is chosen from the persons included within the group)
Single VAT returnThe representative member is responsible for completing VAT returns and paying and reclaiming VAT on behalf of the other members of the group
All supplies made by representative memberAll

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