Sold my Business - Need advice on VAT for my Stock Valuation

[Forest Magic]

Hi there
Got a buyer for my business
Can anyone help me with the following question
I am VAT Registered on Standard Scheme and am a retailer with a large amount of stock that the new owner will be buying at a valuation.
The question is when we agree an amount at cost do i then charge them the VAT on top of the vatable portion and had it to HM Customs or just all of it without any vat on and then they will pay it on their VAT when the items are sold through their till.

I am guessing it will be two figures one being zero rate total and the other being VAT cost but without the vat added

Thanks in advance

 

[Lisa Thomas]

Hello Forest - do you not have accountants acting for the business? This will be costly mistake if you get it wrong and they should be able to advise you.

One thing that might changes things is whether the purchaser is buying the business as a whole on a going concern basis, or just the assets on a break up basis?

 

[Forest Magic]

Hi Lisa

I couldn't get to speak to my accountant at time of asking but he has now spoken to me about the situation.

'One thing that might changes things is whether the purchaser is buying the business as a whole on a going concern basis, or just the assets on a break up basis?'-

Yes, i wouldn't have thought of asking that until i saw your comment - so thank you very much for that helpful tip
If it is sold as a going concern then NO VAT is to be applied to the vatable items

 

[Scalloway]

This may be useful.
Transfer a business as a going concern (VAT Notice 700/9)

Transfer a business as a going concern (VAT Notice 700/9)

When and how to account for VAT when you transfer a business as a going concern (TOGC).

www.gov.uk

 

[Forest Magic]

This may be useful.
Transfer a business as a going concern (VAT Notice 700/9)

Transfer a business as a going concern (VAT Notice 700/9)

When and how to account for VAT when you transfer a business as a going concern (TOGC).

www.gov.uk

Very useful - thanks

 

[Lisa Thomas]

Glad you've been able to get clarity from your accountant. Good luck with the sale.

 

[boxlot]

I recently sold my business I had the same question. This is what I was told - If you sell your Ltd company (all shares will be transferred to buyer), you as a seller will get the money and no VAT will be added. If you keep the Ltd and sell only assets (stock, website, equipment etc), money have to be paid to Ltd account and Ltd have to charge the VAT.