Commentary

V7.239 Capital goods scheme—sale of a capital item when a business is sold

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.239 Capital goods scheme—sale of a capital item when a business is sold

Part V7 Tax planning | Commentary

V7.239 Capital goods scheme—sale of a capital item when a business is sold

The proceeds from the sale of a business are usually outside the scope of VAT as long as certain important conditions are met (see V7.175–V7.188 'Transfer of a Going Concern'). However, the new owner must take over the responsibility for dealing with any remaining adjustment periods for any assets subject to the capital goods scheme. In effect, the capital goods scheme does not cease to be relevant just because an asset has been transferred to a new owner.

To give an example, if Bill bought a property on

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