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Buying Assets from a Dissolving Company: VAT Treatment

3 min readFLAT LAW FIRM
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Contents

1. Context: why this deal is tempting yet risky

Dissolving companies often liquidate assets (machinery, equipment, inventory, vehicles…) below market — a bargain for buyers. But "dissolution" is a legal procedure: from the dissolution decision until name removal, the company still exists as a legal person with full tax duties. Buying assets in this window without proper checks can mean invalid invoices, disputed assets, or back-tax assessments.

2. Seller (dissolving company): VAT duties

Principle: asset sales by a dissolving company remain taxable supplies of goods (except non-taxable items). The company must:

  • Issue VAT invoices for each asset sale — correct timing, actual selling price.
  • Declare and pay output VAT as in normal sales.
  • Finalize taxes (VAT, CIT, PIT…) before completing termination — the tax authority audits before "closing the tax code".

Pricing note: selling materially below market may trigger deemed pricing at finalization. A "cheap price" deal between parties does not bind the tax authority.

3. Buyer: input VAT deduction conditions

The buyer may deduct input VAT if all of the following hold:

  1. Lawful VAT invoice in the buyer's name and tax code — issued while the dissolving company still held invoicing rights.
  2. Goods serve the buyer's VAT-taxable business.
  3. Cashless payment per current thresholds.
  4. Assets capitalized/depreciated per accounting rules.

Critical check: at invoicing time, the seller must still be entitled to use invoices (not under invoice-use suspension, not terminated). Invoices issued after suspension are invalid — the buyer loses the deduction.

4. Pre-purchase due-diligence checklist

  • ☐ Seller's legal status: dissolution decision issued? Which step of the procedure? Still entitled to issue invoices?
  • ☐ Tax status: check whether the seller faces invoice suspension, tax arrears, or ongoing dissolution finalization.
  • ☐ Asset title: mortgaged, seized, disputed? Demand ownership proof (purchase invoices, fixed-asset books, vehicle registration…).
  • ☐ Purchase contract: asset description, price, VAT, delivery/invoicing time, warranties on title and the seller's tax duties.
  • ☐ Payment: bank transfer with clear references to contract/invoice.

5. Common risks

  1. Invalid invoices: the seller was under invoice-use suspension but invoiced anyway — buyer loses deduction, faces back-tax and penalties.
  2. Encumbered assets: banks or enforcement agencies hold priority — the buyer may lose the asset despite paying.
  3. Deemed repricing: the tax authority deems a higher taxable price at the seller's finalization — dispute over who bears the extra tax.
  4. Real estate assets: title transfer, VAT and CIT on real-estate transfers follow separate, more complex rules than movables.
  5. Dissolution vs bankruptcy: a bankrupt company's assets are handled by the Administrator under the Recovery and Bankruptcy Law — different procedure and selling authority (see T-498).

6. Frequently asked questions

Must a dissolving company issue VAT invoices when selling assets? Yes. Asset sales remain taxable supplies (except non-taxable items). The company must invoice and declare/pay output VAT as in normal sales.

Can the buyer deduct input VAT on such purchases? Yes, with a lawful VAT invoice in the buyer's name, VAT-taxable business use, and cashless payment per regulations.

What are the risks if the seller hasn't finalized taxes? Invoices may be deemed invalid under invoice suspension; assets may be seized or mortgaged. Check tax and legal status before paying.

Buying assets from a dissolving company? Contact FLAT Law Firm for tax and legal due diligence before you pay a deposit.

7. Language versions

8. References

  • Law on Value-Added Tax 2024 (No. 48/2024/QH15) — effective 01/07/2025 (Vietnam).
  • Law on Enterprises 2020 (amended by Law 76/2025/QH15) — dissolution procedures.
  • Content cross-checked at the time of writing (28/9/2026).