Results 1 to 2 of 2

Thread: VAT liability for the business I am buying

  1. #1
    New Member
    Join Date
    Oct 2011
    Location
    durban
    Posts
    3
    Thanks
    0
    Thanked 0 Times in 0 Posts

    VAT liability for the business I am buying

    Hi
    I am in the process of buying a business that is not VAT registered. It should have been registered. As the new owner can I be liable for any liability that could be accrued to the previous owner?
    thanlks

  2. #2
    Diamond Member Justloadit's Avatar
    Join Date
    Nov 2010
    Location
    Johannesburg
    Posts
    3,480
    Thanks
    134
    Thanked 695 Times in 593 Posts
    Blog Entries
    1
    The short answer is yes.

    However, when you buy a business, you buy the debtors and creditor contacts and not the debtors or creditors book, and any asset and stock only, you never buy the company as such. This is standard practice. In this way you start trading from a clean sheet. The seller then gives you the irrevocable right to use the company name in your new business. You want a new registration number and bank account.

    It then becomes the sellers problem to collect payments till the date of ended trading, and payment of any creditors till date of end of trading.
    Victor - Knowledge is a blessing or a curse, your current circumstances make you decide!
    Solar pumping, Solar Geyser & Solar Security lighting solutions - www.microsolve.co.za

Similar Threads

  1. buying a business or investments
    By obinwanne in forum General Business Forum
    Replies: 4
    Last Post: 03-Nov-12, 07:19 AM
  2. [Question] Smoothing Liability
    By JKS in forum Accounting Forum
    Replies: 11
    Last Post: 23-Apr-12, 01:54 PM
  3. Buying a business
    By TedP in forum General Business Forum
    Replies: 12
    Last Post: 15-Oct-10, 12:08 PM
  4. [Question] Liability when scammed ?
    By HAGGIS in forum General Business Forum
    Replies: 16
    Last Post: 16-Sep-08, 11:47 AM
  5. VAT: representative vendor liability
    By duncan drennan in forum Tax Forum
    Replies: 4
    Last Post: 25-Oct-06, 10:15 AM

Did you like this article? Share it with your favourite social network.

Did you like this article? Share it with your favourite social network.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •