VAT Liability When Writing Off Fixed Assets: Conditions and Documentation Requirements

• VAT liability arises when low-value non-current assets or inventories are written off and can no longer be used in business activities.
• For liquidation of fixed assets by the taxpayer’s own decision, it is treated as a supply at fair market value, but not less than book value, for VAT purposes.
• No VAT liability arises if fixed assets are liquidated and cannot be used for their original purpose, provided a properly executed document confirming destruction or conversion is submitted to the tax authorities.
• The document must confirm the fact of destruction, dismantling, or conversion and contain all necessary details to identify the transaction.

Source: news.dtkt.ua

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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