VAT Grouping

VAT Grouping is a tax arrangement that allows multiple related businesses to combine their VAT accounts into one. This means the businesses can manage their Value Added Tax (VAT) collectively, rather than individually. When grouped, they can offset their VAT liabilities against any VAT they are owed, simplifying the process and potentially reducing the overall VAT burden. This is beneficial for companies that are closely linked, as it streamlines administration and can improve cash flow. However, all members of the group are jointly responsible for the group's VAT obligations.