CHAPTER – VIII

TRANSFER OF A BUSINESS

36.     Conditions for Transfer of a Business.

          The transfer of a business from one VAT dealer to another VAT dealer is exempt from VAT subject to the following conditions, namely;-       

          a)       the business must be transferred as an ongoing concern and continue trading under the new ownership;       

          b)      the VAT dealer transferring the business shall notify the authority prescribed of the transfer of the business within ten days of the date of the transfer;

          c)       the VAT dealer transferring the business shall apply for cancellation of his registration, if warranted and shall comply with the provisions of Rule 14.

          d)      The VAT dealer acquiring the business shall account for tax on the stock and assets acquired, at the time of their sale.

          e)       The VAT dealer acquiring the business shall retain all the tax records related to that business for a period of not less than six years as specified in sub-section (4) of Section 42 after the end of the year in which the business was acquired.