I've been approached via another client by a shareholder of a property company. There are 3 shareholders and they sold both rental properties in the y/e 31/3/08. The Company is to be wound up but there is a difference of opinion about distributing the shareholder funds. The Company's accounting firm has recommended a series of dividends which would span 3 years to avoid higher rate tax, this suits 1 shareholder, also a client of the same accounting firm but not the other 2. The accountants have said that a special resolution would be required to force a C16 route with a 75% majority which of course won't be achieved. This doesn't seem right to me but can't locate any information on this. Any suggestions?
Mark Peters
Replies (6)
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negotiate
Remember the other two have the ability to sanction or block the declaration of dividends. So they may be able to negotiate a compromise with the minority shareholder.
Correct
75% voting majority requried for a special resolution, which is held at a General Meeting.
I presume you have explored whether Entrepeneurs Relief could be available?
Depending on...
...the circumstances. Application for capital treatment on company purchase of own shares might be worth looking at.
Special resolution
A Special Resolution requires a 75% vote in favour, see
http://www.companieshouse.gov.uk/about/gbhtml/gba7.shtml
David