How do I zero rate a going concern when I don’t have a VAT registered company?
Almost every day, I get a phone call from someone who wants to buy a VAT registered shelf company. It’s usually because they want to buy a going concern business (most commonly a commercial property) at zero rate from a VAT registered company.
As I explained in my February article a shelf company cannot, by definition, be VAT registered, because a shelf company is one that has never traded.
Taking any route to buy such a company is therefore very risky.
There is, however, a solution:
- Register a new company.
- Sign the Offer to Purchase (OTP) in that company’s name.
- Register the company for VAT based upon the OTP.
It works perfectly if you know what you’re doing and we do.
So, I decided to offer a discounted package that includes
- Register a new company
- Write the SARS compliant OTP
- Register the Newco for VAT
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Good day. I am buying a property and I need to zero rate the transaction.
The seller is vat registered but is not selling his company.
Are you able to assist and what will your cost be?
Hi Ismail,
Sorry about the delay. I had a hip replacement on 29th
The buyer needs to be a company that is registered or is registering for VAT. Transfer cannot take place until it is registered. That has to form part of the sale agreement. I will send you a qjote for the full monty. If you already have a company then you can ignore what you don’t need from us.
Register a new company
Write the SARS compliant OTP
Register the Newco for VAT
Hi,
I was not asking the question. My article answers it.