Sale Of Business As A Going Concern Agreement South Africa
In the sale agreement, it is not enough to declare that the transaction is sold “as a current business.” The key to the correct structuring of the agreement lies in the provisions of Article 11 of Act 89 of 1991 on VAT (the “value added tax”) and, in particular, section 11 (1)) e), which must meet the following conditions: all transactions owned by it or the value of the company or the goods or goods that are part of the transaction. In order for a property to be sold as a current entity, the following five factors must be present and included in the sale agreement: as a general rule, the sale of a business is not by the sale of its assets, but by the sale of the business as a current business. A simple sale of assets would attract VAT at the applicable rate. On the other hand, the sale of a business as a current business can be structured so that turnover is valued at zero from a VAT point of view. It is important to note that this is not an exemption from VAT, but the application of zero-rate VAT. When a bank funds the purchase of a business transaction, the risk is too high if Section 34 may not be met in cases where compliance with Section 34 is required. Selling shares in a company, whether it`s a nearby company or a business, is really very simple. It is simply a matter of transferring a group of assets in the form of shares. Whether it is when buying shares or a business, a buyer should perform a due diligence assessment. The objective is to determine the value of the shares and/or transactions as well as the potential risks in the transaction and transaction. When a shareholder or member sells his shares or members` shares, he transfers his property to the company or cc to the buyer.
They do not actually transfer CC`s assets or activities. Third, where it can only be operated as a business (i.e., a dormant business), the asset assets or sold are not an income activity, as it is a real or current business or an actual operation. In accordance with section 34, paragraph 1, the transfer of goods or objects can only be attacked if it is part of the professional`s activity. Whether certain goods or objects constitute such a party must be determined by taking into account the circumstances of each case. Second, the business must be a day-to-day business within the meaning of paragraph i of the section 11, paragraph 1, point e reservation, and meet the criteria set out in paragraphs 4-6. A simple sale of z.B. an agricultural property is considered to be the provision of a capital asset and not necessarily as a farm. When all farm equipment, crops and assets required for agricultural activities are included and the parties expressly agree that income activities are included and sold, the offer will be considered a routine business. In the fourth case, the seller may retain assets that are not necessary for the transaction and it is therefore possible to divest part of an existing activity as long as that part is sold, when it can be considered a viable activity. This includes a formal advertisement for the sale of the business.
If the parties do not do so and a creditor liquidates the transaction within six months of the sale, the creditor may consider the sale to be null and void and claim the asset as unsold.