Hi All, I've rarely dealt with group accounting and restructuring etc so any help is appreciated, or some guidance in the right direction.
I have a client who is looking to go under a bit of a restructure after only 8 months of being incorporated.
Current situation is that Company A has shares of 200 split 151 and 49. Majority shareholder wishes to set up a group structure due to the immenent set up of a new Ltd Co (Company B) and purchase of a pub/resturant, and possibly another in the near future depending on success.
From what I gather, majority shareholder of A wants to set up a parent company (Company C) to own the freehold pub, (a ring-fencing strategy?), and also have their 151 shares in Company A, in exchange for shares in the parent and therefore be the 100% shareholder of C. B would be 100% owned by C when incorporated, and similar for future companies if they go through with it. A & B companies would have turnover of less than £500k per year. As would any further companies.
I need a few things confirming/explaining if possible;
How would the majority shareholder take dividends? Would Company, A & B pay dividends to C? and then C pays to Shareholder?
Would said dividends paid to C be free of tax charges? All the tax would be paid by the shareholder as with normal dividends?
What would be the best way to deal with the pub in C? It would be in FA and the other side would be the mortgage in long term creditors, but then should C charge B rent? Or should C have no trading activity and keep it as payments of dividends only? Could capital allowances be claimed and could that offset against A & B CT Charge?
How would the 151 shares in A be transferred to C? Via Share Exchange? and would there be a stamp duty liability? or can this be avoided?
Sorry for all the questions, but any help is appreciated.