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Finance to Acquire Company

Acquisition finance LTD company

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Hi All, 

When acquiring a LTD company can Is there any way of partially acquiring the company with the cash within it, the company has around £50k cash, can this be given as partial payment to the current director for the sale of the company or will this trigger tax? Alternatively can I lend the money company to purchase itself from the current owners, then once the shares are transfered pay myself back partially from the cash reserves without paying tax on the payment.

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By paul.benny
01st Jul 2020 18:01

Those options look possible but each will have different tax consequences. Without knowing the financial circumstances of both of you, it's not practicable to give definitive guidance. Both you and the vendor should proper advise from an accountant.

You might also want to take legal advice on the agreement to purchase the company - in particular to protect you should there be undisclosed claims or liabilities against the company.

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