A recently acquired client is in the construction sector (t/over £1m, profit £150k) and has some £300k (at MV) of plant (JCBs etc.) and a small yard/workshop £150k MV (Husband and wife 50-50 ownership). Reserves are £400k
In the interests of protection from claims or bad debts I have mooted the idea with them of holding the plant outside of the main trading company so that should a claim ever arise, or they lose significantly on a final stage payment (as often seems to happen in their industry (and recently happened to them £75k ouch))then they would at least still retain plant.
My initial thoughts are to form a newco (same shareholding as existing) and then do share for share exchange so that newco owns existing trading company. I would then recommend assets are sold at no gain/loss to Holding company and this would be paid for via a dividend to holding company of the existing reserves.
(note the plant has £300k MV but a TWDV for CAs of £40k which is why I have not considered a straightforward sales of the plant to a new non group company)
I would appreciate other readers thoughts or alternatives before I start the process of establishing newco and gaining relevant HMRC clearances (including SDLT) - previous experiences good and bad welcome!
One other minor consideration (which is where the niggle in my mind comes from) is that they are considering bringing son into the company and asked "can we give Son no.1 25% of the company at the same time" to which initial thoughts of capital gains sprung to mind.