Selling your company – Entrepreneurs’ Relief traps for the unwary!

The disposal of a business should always be driven by the commercial objectives of the buyer and the seller and tax planning should not distract from this.  However, ensuring an exit is implemented in the most tax efficient manner can help bridge any commercial disparities between the two parties.  Often tax planning structures require to be put in place prior to a disposal but, without a crystal ball, it is difficult to predict when an exit opportunity will arise.  However, reviewing the existing company structure and shareholding profile should be considered to increase tax efficiencies prior to selling an entrepreneurial company.  

Will Size Matter to the Entrepreneur?

In order to continue to promote enterprise and encourage growth HMRC have recently published a consultation to allow individuals to retain their Entrepreneurs’ Relief (“ER”) entitlement where certain qualifying conditions are no longer met.

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