United Kingdom

VAT Grouping Active Updated 2026-01-151 change this quarter

Baseline

UK VAT Grouping & Registration Framework

The UK allows related businesses to form VAT groups, treating the group as a single taxable entity. This eliminates VAT charges on intra-group supplies. Post-Brexit, the UK has diverged from EU rules on grouping, registration thresholds, and the scope of VAT exemptions.

Key Dates

1973VAT grouping provisions introduced

Apr 2024VAT registration threshold increased to GBP 90,000

2025HMRC reviewing VAT grouping rules for financial services

Who is in scope

Bodies corporate (companies) under common control can form a VAT group. Partnerships and individuals are excluded.

Process

Application to HMRC to form/join/leave a VAT group -> HMRC approval -> group treated as single taxable person -> representative member files single VAT return for group.

Official Sources

HMRC — VAT Grouping HMRC — VAT Registration

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