Selling part of the Company
Currently a limited company has issued 1000 shares @ £1. All these shares are owned by one director. Now he is trying to bring in another partner in to the business. The partner may invest some money in to the business or forego his salary for the next few years ( undecided yet - tax savings will play a part here).
So, if the current director wants to give up 50% ownership to the new investor , what would be the best structure?
1. Can they open up a holding company and both can have 50/50 ownership in the holding company and the holding company can have 100% shares in the existing company? In this case when the current director transfer all his shares to the holding company, what are the tax implications?
2. Is it simple to issue another 1000 shares to the new investor? Any tax implications?
3. When new shares are issued in the existing company, what value it should be issued at? Par value? or a valuation should be carried out ( partners may not be interestd what value it is offerred) - for Revenue/Tax purposes? What are the tax implications including stamp duty etc?
4. if the shares are trasferred to the holding company, will there be any stamp duty or taxes?
Thanks for your help in this matter.
- Who would you nominate for a Practice Excellence Award? 138 1
- How to change credit note allocation in Sage 217 9
- How to Value a Business 474 9
- can a CGT transfer be legally cancelled in the future if 134 5
- Simple Ltd company accounts service 541 13
- How much did you pay for your website 481 13
- Companies House 140 2
- HMRC repayment issued, how long till it hits account? 113 1
- Sage Payroll & NIC 381 7
- Company Pension Contributions 260 6
- Gross Profit Percentage 220 4
- Expenses allowable 171 3
- Let Property Campaign 386 6
- Is there anything I should know about Northern Irish companies? 135 1
- Self employment trap - pension 347 3
- Awkward IP 612 9
- ESC A19 130 2
- When does my Property business start 269 4
- Does anybody still use a Filofax? 1,537 43
- On line petition re HMRC grabbing money from taxpayer bank accounts 868 19
- CTA study material 603
- DTR : TIOPA 2010 Section 42 593
- Anyone have clients that use Pay4Later to offer customers credit? 366
- Employment related securities question 224
- Foreign Business setting up in UK 199
- ATED Penalties 196
- AIM Stocks and IHT 176
- Tax Relief for overseas employees 135
- Expat pension contributions? 127
- Trust for Employee 125