In order to sell your business or property as a going concern SARS has laid down certain requirements in order to zero rate the transactions in terms of the VAT act. These requirements are as follows.
1. The Seller and Purchaser must both be registered vendors;
2. The supply must consist of an enterprise or part of an enterprise which is capable of separate operation, for example on a rental property, there must be a lease agreement operating;
3. Parties must agree in writing that the supply is a going concern;
4. The enterprise must be an income generating activity;
5. The assets necessary for carrying on the enterprise must be disposed of to the Purchaser;
6. The parties must agree in writing that the consideration for the supply includes VAT at the zero rate.
Should you have any further questions in this regard, kindly contact craig@burmeisters.co.za.
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