The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
The value of a company needs to be determined for commercial reasons, for example when the owners intend to sell the company. The main valuation methods are:
industry standard methods
net assets basis
discounted cashflow, and
These are discussed below.
The capitalised earnings basis of valuation is probably the most commonly applied technique in valuing private company shares.
The formula is:
Future maintainable earnings x Price / Earnings (P / E) multiple
Future maintainable earnings are determined as follows:
determine the future anticipated profits:
these should be calculated based on historic audited results
if results are stable then the previous period’s results should be an acceptable basis for determining sustainable profits
if results have fluctuated in the
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
The supply of fuel and power is treated as a supply of goods for VAT purposes. Supplies are fuel and power are normally liable to VAT at the standard rate. However, providing certain conditions are satisfied, it is possible for suppliers to charge the reduced rate of VAT on certain supplies of fuel
The majority of state benefits (also called social security benefits) are managed by the Department of Work and Pensions (DWP) via the Jobcentre Plus.Some benefits are dependent on a national insurance contribution record (and different classes of national insurance provide different benefit
This guidance note provides details of quarterly instalment payments (QIPs) for corporation tax purposes and which companies need to pay their tax liabilities in this manner.Generally, corporation tax is payable nine months and one day after the end of the relevant accounting period. However, large
Restriction of carry forward and carry back of trading lossesFollowing the extensive changes to the loss carry forward provisions introduced from 1 April 2017, the anti-avoidance rules restricting the offset of trading losses following a change in ownership were tightened up and extended.
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.