Selling your Company Shares or Assets?

Friday November 2015

A vendor would normally prefer to sell their shares in the company rather than a trade and asset deal, as they would usually pay more tax – corporation tax on the sale of assets, followed by a second tax charge getting the cash out of the company. A share sale would of course mean just 10% CGT, where the shareholder qualifies for entrepreneurs’ relief.
Plus, the recent change blocking the tax deduction of acquired goodwill for the purchaser will mean that there will be less of a conflict between vendor and purchaser as to how the deal is structured. Where the business being sold has accumulated trading losses the purchasing company may be able to take advantage of those losses, if they buy shares, whereas those losses would lapse where just the assets are acquired.
Please contact us if you are planning to sell your business as we can help you minimise the tax payable on the sale.

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