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22nd April 2014
Posted in Articles, Featured Articles, Private Client by Forbes Dawson
Consider a scenario where a shareholder is facing a gain at 28%.
This would be the case when he is disposing of a company which does not qualify for Entrepreneurs’ Relief or if he has (or will) exceed the £10M lifetime Entrepreneurs’ Relief allowance.
Detailed advice should be obtained prior to any planning of this kind. For example a holding company will usually be inserted using a share for share exchange and we would not want this to trigger a tax charge. For bona fide commercial transactions this would not usually be the case and clearance could be obtained from HMRC.
This kind of structuring generally only results in a tax deferral, although in some cases the shareholder may go non-resident and depending on the jurisdiction they move to they could make a real tax saving.
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