Asset Purchase Agreement Template (UK)

Updated on 9 August 2026

A UK asset purchase agreement transfers selected assets of a business rather than the shares in the company that owns them. It should identify exactly what is sold, what is excluded, which liabilities stay with the seller, whether employees transfer, how VAT is treated, what consents are needed and what must happen at completion.

The source template says little about VAT, TUPE, stock, debtors, contracts, data, employees or completion deliverables. This UK version is built for a small-business asset sale, equipment sale, IP and goodwill transfer, or business sale where the parties need a real schedule and local law warnings rather than a generic transfer paragraph.

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Asset Purchase Agreement

Seller:
Buyer:
Agreement date:
Purchase price:

1. Sale and Purchase of Assets

agrees to sell, and agrees to buy, the assets listed here:

Excluded assets:

2. Price and VAT

The purchase price is . VAT treatment selected: . If VAT is chargeable contrary to the parties expectations, the parties will cooperate to provide evidence and settle the VAT position stated in the agreed tax schedule.

3. Liabilities

The buyer assumes only these liabilities: . All other liabilities remain with the seller unless the agreement expressly says otherwise or applicable law provides otherwise.

4. Employees and TUPE

TUPE position selected: . If TUPE may apply, the parties will complete employee information, consultation and indemnity schedules before completion.

5. Contracts, Consents and Novations

Required assignments, novations, notices, releases and third-party consents:

6. Completion

Completion deliverables:

7. Further Assurance

After completion, each party will sign and deliver reasonable documents needed to give effect to the asset transfer, including late consents, notices, records and corrections.

Seller

Date signed:

Buyer

Date signed:

Asset sale is not share sale

In an asset sale, the buyer picks the assets it wants and usually leaves excluded assets and most liabilities behind unless the agreement says otherwise or the law transfers them. The agreement therefore needs schedules for assets included, excluded assets, assumed liabilities, retained liabilities, third-party consents and completion deliverables.

Goodwill, business names, domain names, customer lists, stock, plant, vehicles, IP, software, contracts, deposits, work in progress and records all need different transfer mechanics. A one-line sale of "all assets" is not enough evidence for completion.

VAT and transfer of a going concern

HMRC VAT Notice 700/9 explains that a transfer of a business as a going concern can be outside the scope of VAT if mandatory conditions are met. Those conditions include that the assets are used to carry on the same kind of business, the buyer intends to carry on that business and other VAT conditions are satisfied. If the conditions are not met, VAT may be chargeable on some or all assets.

This template does not declare the sale a TOGC automatically. It includes a VAT selector, buyer VAT registration details, an option to treat the price as exclusive of VAT if HMRC disagrees, and a cooperation covenant for VAT evidence. That is safer than pretending every asset sale is VAT-free.

TUPE can transfer employees automatically

GOV.UK guidance on business transfers explains that TUPE may apply when a business or part of a business changes owner, and size does not matter. Where TUPE applies, employees assigned to the transferring business usually transfer on their existing terms, with continuity of employment preserved. The parties must inform and, where required, consult affected employees or representatives.

The agreement therefore asks whether employees, workers or contractors are involved and whether TUPE advice has been taken. If TUPE may apply, employee information, indemnities and consultation responsibilities need careful drafting. If no employees transfer, the agreement should still say why and record the seller warranty.

Contracts, IP, data and consents

Contracts do not always transfer just because the assets do. Benefits may be assignable, but liabilities often require novation or other consent from the counterparty. IP transfers normally need signed writing, domain transfers need registrar steps, software licences may be non-transferable and customer data may need a lawful data-transfer basis.

The template includes completion deliverables for assignments, novations, notices, IP instruments, domain codes, handover data and records. It cross-links to the assignment-and-assumption family rather than forcing a contract-transfer mechanism into the asset schedule.

Warranties, limitations and completion

Seller warranties should fit the asset type: title, condition, encumbrances, stock quality, IP ownership, accounts, contracts, employees, data, tax and litigation. Buyer warranties should cover authority, funds, VAT status and assumption of stated liabilities. Liability limits need to reflect the price and risk, not a copied number.

Completion should be operational. The agreement records payment method, transfer documents, keys, passwords, stock count, apportionments, insurance changeover, notices and post-completion cooperation. That is what makes the contract executable on completion day.

Clause-by-clause guide

Asset schedule: Lists tangible assets, stock, goodwill, IP, contracts, records, domains, vehicles and excluded assets.
Price and apportionment: Sets price, deposit, completion payment, allocation, stock adjustment and VAT treatment.
VAT and TOGC: Records whether the parties expect TOGC treatment and what happens if HMRC disagrees.
Employees and TUPE: Captures whether employees transfer, consultation duties, employee information and indemnities.
Contracts and consents: Identifies assignments, novations, notices and third-party approvals needed at or after completion.
Warranties: Tailors title, condition, IP, data, accounts, employee, litigation and authority warranties to the transaction.
Completion deliverables: Lists executed transfers, keys, passwords, domain codes, stock count, records and payment evidence.
Post-completion cooperation: Handles misdirected payments, late consents, record access, VAT cooperation and further assurance.

UK asset-sale checklist

Check these issues before signing an asset purchase agreement.

Decide whether TOGC treatment is available
HMRC Notice 700/9 sets conditions for a transfer of a business as a going concern to be outside the scope of VAT. Do not assume every asset sale qualifies.
HMRC VAT Notice 700/9
Check TUPE before completion
TUPE may apply when a business or part of a business changes owner. Employee jobs, terms and continuity can transfer automatically.
GOV.UK - business transfers and takeovers
Inform and consult where required
Employers must inform and, where required, consult affected employees or representatives. Smaller employers may have direct-consultation routes in some cases.
GOV.UK - consulting and informing
List excluded assets and retained liabilities
The buyer should know what is not being bought and which liabilities stay with the seller.
Use the right contract-transfer mechanism
Benefits may be assigned, but liabilities generally need novation or counterparty consent.
Transfer IP and data carefully
Copyright assignments need signed writing, software licences may be non-transferable and customer data needs a lawful transfer basis.
GOV.UK - licence and sell copyright
Make completion evidence concrete
List payment, bills of sale, IP assignments, domain transfers, keys, passwords, stock count, records and notices.

How to complete the UK APA

Build the schedules. List included assets, excluded assets, stock, contracts, IP, records and liabilities.
Set price and VAT. Enter price, allocation, completion payment, VAT position and TOGC evidence if relevant.
Check employees. Decide whether TUPE may apply and record consultation, employee information and indemnities.
Map consents. Identify assignments, novations, notices, finance releases, landlord consents and licence transfers.
Prepare completion. List transfer documents, payment evidence, keys, passwords, domain codes, stock count and post-completion cooperation.

Frequently asked questions

What is an asset purchase agreement?

It is a contract for buying selected assets of a business rather than buying the shares in the company that owns them.

Does VAT apply to a UK business asset sale?

It depends. HMRC Notice 700/9 explains when a transfer of a business as a going concern can be outside the scope of VAT. The agreement should not assume TOGC treatment without checking the conditions.

Can employees transfer with the assets?

Yes. TUPE may apply when a business or part of a business changes owner, and employee terms and continuity may transfer automatically.

Do customer contracts transfer automatically?

Not always. Some benefits may be assigned, but liabilities and full contract substitution usually require novation or counterparty consent.

What should be in the asset schedule?

Include equipment, stock, goodwill, IP, domain names, contracts, records, vehicles, deposits, excluded assets and assumed or retained liabilities.

Can software licences be sold with the business?

Only if the licence permits transfer or the licensor consents. Many software licences are personal to the seller.

What happens on completion day?

The parties exchange payment, transfer documents, keys, passwords, domain controls, stock count evidence, notices and any consent or further-assurance documents.

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Disclaimer

This UK template and guide are provided for general information only and are not legal, tax, employment, regulatory, filing, insolvency, data-protection, accounting, title or professional advice. Laws, fees, government forms and filing practice can change; check the current official source and take advice before relying on the document.