On 1 November 2019, the VAT grouping provisions contained in Schedule 18, Finance Act 2019, came into force and non-corporate entities can now join a VAT group if they meet certain conditions.
Sections 43 and 43AZA, Value Added Tax Act 1994, have been amended so that certain individuals and partnerships controlling “UK bodies corporate” can be part of a VAT group with those bodies corporate. Section 43AZA specifies the test that applies when determining whether an individual or partnership controls a UK body corporate.
These amendments have been made following the judgment of the Court of Justice of the European Union in Larentia + Minerva and Marenave (C-108/14 and C-109/14).
HMRC guidance has not yet been issued in relation to the new rules and it is anticipated that VAT Notice 700/2 will be updated shortly.
The Regulations appointing 1 November 2019 as the day on which the changes came into force can be viewed here.
