I am going to sell my business as a going concern. Do I have to charge VAT on the stock and assets?
The transfer of such assets are deemed to be neither a supply of goods nor a supply of services if:
- the transfer is part of a transfer of the economic activity itself, or part thereof, which is capable of separate operation as a going concern.
- the said assets are to be used by the transferee in carrying on the same kind of activity.
- the transfer is recorded in the records of the transferor indicating the transferee and his registration number.
In such cases VAT is not charged on the sale. The invoice should state clearly that this is a transfer of a going concern and a brief reference to the relevant provision in the VAT Act.