Asset sales

Asset sales

In an asset sale the buyer purchases only those assets and assumes only those liabilities it wishes to acquire:

•
sometimes an asset sale is the sale of an entire business (ie all the assets that form part of, and are used in, that business) or part of a business, but
•
sometimes it is just a sale of an asset or a collection of assets

In this Overview:

•
it is assumed that the parties to a sale are unconnected third parties acting on arm's length terms
•
CGT means capital gains tax and corporation tax on chargeable gains
•
TOGC means a transfer of a going concern for VAT purposes, and
•
TUPE Regulations 2006 means the Transfer of Undertakings (Protection of Employment) Regulations 2006, SI 2006/246

Tax considerations in an asset sale

The tax consequences of an asset sale are generally more complex than those that would be triggered by a share sale (see Practice Note: Share sale or asset sale—tax considerations). This is because an asset sale, particularly a sale of a business, usually involves numerous assets of different types, such as:

•
premises,

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