The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
When businesses are looking for advice in relation to selling the family company, there are some common situations which often arise. This guidance note sets out some of these situations together with suggestions of a possible course of tax planning to maximise available reliefs. These situations can provide a starting point for conversations with clients who want to discuss selling their company. Included within each situation summary are links to other guidance notes or resources so that further detailed research can be done.
The list of situations dealt with in this guidance note are as follows:
Sale of company to a third party
Sale of the company but part of the business not to be included
Splitting of a property investment company between shareholders
Sale to third party with consideration in cash and loan notes
Sale of trade and assets and extracting remaining reserves
The company is looking to be acquired by a third party or a third party has made an offer to the owners of the company to acquire all their shares.
It is important to ensure that the share structure of the company maximises any tax reliefs especially business asset disposal relief (previously called entrepreneurs’ relief) and any available planning between spouses and civil partners. In addition, the impact of the sale on any share incentive schemes should be reviewed. When a buyer acquires a company, rather than the assets of a business, all of the historic liabilities of that company are also acquired and the buyer will expect to obtain the protection of tax warranties and a tax covenant from the company owners. As part of the sale process, due diligence will be carried out on the company being sold which would cover corporation tax, PAYE and VAT which may require the completion of a detailed checklist by the tax adviser for the company.
The following guidance notes are relevant to this planning
**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
If an individual sells a chargeable asset and makes an allowable loss, how can this be relieved?First of all, since the simplification of capital gains tax from 6 April 2008, the proforma to calculate a loss is the same as the proforma to calculate a gain. See the Basic calculation principles of
In certain circumstances shareholders may wish to pay dividends other than in proportion to their shareholdings. This aim is typically achieved by one or more shareholders not taking a dividend when it is declared. To effect this, the relevant shareholders must waive their right to dividends from
This guidance note explains the general rules surrounding the availability of indexation allowance on the disposal of company assets and provides information on the rebasing rules for assets held on 31 March 1982. For an overview of the general position regarding company disposals, please refer to
Duty to prepare estate accountsThe Personal Representatives' (PRs) legal obligation to prepare accounts is set out in Section 25 of the Administration of Estates Act 1925. Their prescribed duties include:when required to do so by the Court, exhibit on oath in the Court a full inventory of the estate
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.