Transfer of business when input tax not deductible for recipient

• Transfer of assets in a business transfer is not considered a delivery of goods or provision of services
• Conditions for the transfer to not be considered a delivery of goods or provision of services:
• VAT should be charged on the transfer of assets according to other rules
• VAT is partially or not deductible for the recipient of the assets
• Application of the provision would distort competition or involve tax evasion
• The new stance replaces the previous stance on mixed business transfers for VAT
• The new stance is based on the new VAT law effective from July 1, 2023
• The new stance does not change the assessment in most cases
• The VAT law has different terminology and structure compared to the previous law
• Skatteverket has reviewed its interpretation of the law due to these changes
• Business transfer does not constitute a delivery of goods or provision of services if VAT would be deductible for the recipient
• Member states can take measures to prevent distortion of competition in case the recipient is not fully taxable
• Measures can also be taken to prevent tax evasion and avoidance through the transfer of assets.

Source: www4.skatteverket.se

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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