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Buying and selling a business

There’s a lot to think about when buying or selling a business and as accountants and tax advisors specialising in owner-managed businesses, RJP has extensive experience of both company sales and purchases.

This is an area fraught with pitfalls and the more informed and prepared you can be early on in the process, the greater the likelihood of achieving your financial goals. In addition to having extensive professional experience, we know the Surrey and South London area and its business community very well, making us a natural partner for clients seeking to expand or exit a going concern.

Expert advice for clients looking to buy a business

One of the fastest ways to expand a business or to diversify is through acquisition and we have advised many clients interested in purchasing a competitor, or a business in a complementary field. Some of the advantages of buying a business include benefiting from the business’ proven track record when it comes to securing finance, established customers and a strong reputation, plus it can offer a new channel to market.

However, buying a business is not a decision to be taken lightly. The business needs a valuation and purchase price negotiating. Additional finance may be required and there may be other administrative processes to complete, for instance, transferring a VAT registration.

Our range of services for clients looking to purchase a company includes:

  • Due diligence to identify potential problems before it is too late;
  • Tax planning for the structure of the purchase;
  • Handling all liaison with solicitors, venture capital firms, HMRC and other professional advisors.

Expert advice for clients wanting to sell a business

Starting, growing, and ultimately selling a company, is the primary goal of many clients. At RJP, we will help you to achieve this as smoothly and tax efficiently as possible, by helping you take advantage of all tax planning opportunities. We very much specialise in this area and have helped hundreds of business owners to exit their companies.

Maximise tax relief when you sell

RJP’s tax planning focus is on ensuring you receive business asset disposal relief (formerly entrepreneurs’ relief) on both initial and deferred consideration, so that your capital gains tax liability is capped at 10% on all consideration received on gains of up to £1m. To achieve this, it is beneficial to seek professional advice early on when a sale is first contemplated, and ideally at least 14 months before a sale is anticipated. The eligibility criteria for business asset disposal relief mean that it is necessary to have held the relevant shares for at least 2 years in order to qualify for this tax relief, making early action imperative.  If you are fast approaching a sale, we strongly recommend you get expert tax advice before you sign the Heads of Terms.

Exit planning when you are selling a business is best undertaken sooner rather than later – don’t leave it until the last minute when it may be too late to deal with any issues and limit your tax liability.

Our services for clients wishing to sell a company include:

  • Advising clients on the structure of the Heads of Terms for tax efficiency;
  • Advising on the tax structuring of initial and deferred consideration;
  • Drafting and obtaining clearances from HMRC;
  • Tax planning to minimise tax liabilities;
  • Reviewing and advising on Tax Warranties and the Tax Deed;
  • Liaising with all parties.

Whether you’re intending to sell soon or are planning ahead, talk to us to see how we can help.

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31 July 2020 - Normally an important deadline!

All taxpayers due to make self-assessment tax payments on 31 July 2020 can now delay their payment due to the disruption caused by Coronavirus. This includes self-employed taxpayers and also company directors who pay self-assessment tax on dividend income.

Read more in our coverage of Coronavirus and business support from the Government.