If you are considering acquiring a business through a business transfer, it is crucial to take preventive measures to avoid future financial liabilities with the tax authorities, social security and business employees. Below, we provide you with detailed information and practical tips to minimize risks and ensure a safe and debt-free transition.
1. Tax Liability: Protect Your Investment
When you acquire a going concern, you may inherit the transferor’s tax liabilities. To avoid unpleasant surprises, follow these steps:
- Business succession certificate: Request this certificate through the AEAT website to verify the transferor’s tax debts and liabilities before completing the transaction.
- Consequences and precautions: If the certificate indicates outstanding debts, make sure that the transferor cancels them before the transfer. In cases of pending litigation, withhold part of the sale price as a precaution.
- Deadlines and release: The tax authorities have three months to issue the certificate. You are released from liability if it is not issued within this period.
2. Social Security and Employees: protect your labor interests
The situation with Social Security and employees also requires special attention:
- Certification of Social Security debts: Request a certificate to ensure that the transferor is up to date with its obligations.
- Warranty clauses in the contract: Include clauses that obligate the seller to guarantee the absence of labor debts and to answer for any future liability.
- Labor responsibilities: If you plan to keep current employees, be sure to comply with their existing labor conditions. If not, demand that the transferor properly settle their contracts.
Remember, when acquiring a business, you assume both the assets and associated liabilities.
This is essential:
- Complete documentation: Verify all relevant documentation before finalizing the transaction to avoid future contingencies.
- Protective clauses: Include clauses in the contract that protect your financial and employment interests, ensuring that the transferor is liable for any pre-transfer debts or claims.
In short, by taking these precautions, you not only protect your investment, but also ensure a smooth transition. Do not hesitate to contact us for any additional consultation or assistance you may need in this crucial process for your business.
You can contact this professional firm for any questions or clarification you may have in this regard.
For more information, please contact our Legal Department
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