Two parties to the sale of a high-value real estate asset considered that the transfer should be the transfer of a going concern. The buyer was not prepared to risk 20% of the sales proceeds being subject to VAT if HMRC queried the tax treatment in the future.

Due to the rules on TOGCs and the lack of certainty provided by legal advice on the point, the buyer would not complete the transaction without escrow or insurance. 

An insurance policy was issued to the buyer as the seller was certain the sale was a TOGC and therefore did not wish to contemplate a lengthy escrow. The underwriting process was complete within 48 hours of being instructed.