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Is Entrepreneurs Relief available here?

Mr X owns a hotel privately. X owned a Ltd company and ceased trading nearly 3 years ago.

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Hello to everyone on this forum. I hope you are all well and there is someone kind enough to give me an opinion on the following:

  • Mr X operated a hotel business via a ltd company. The hotel property was owned privately by Mr X.
  • Mr X ceased trading of the business on 3rd August 2016. The business was then transferred to his son’s New Ltd company which began to trade on 4th August 2016. No consideration was made for the transfer of the trade.
  • Mr X then sold his hotel property in May 2019.

This feels like an associated disposal and therefore ER applies - however the disposal of the business in 2016 is not a text book disposal (I.e no shares were sold).

Can someone please provide an opinion on the above? 

Any advice will be most welcome. 

Kind regards

 

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26th May 2019 11:31

Did you obtain your Practising Certificate?

https://www.accountingweb.co.uk/any-answers/setting-up-accountancy-busin...

In April last year, you mentioned that you would "obtain my certificate in 2 years time"

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26th May 2019 13:05

No - I am still working towards this - thank you for asking.

The Entrepreneurs Relief question relates to a family member and I will not be representing them because I don’t have a certificate or the sufficient knowledge.

Anyway - if any can help with my original question I would really appreciate it.

Kindest regards

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to ACCAGOAT
26th May 2019 17:52

ACCAGOAT wrote:

The Entrepreneurs Relief question relates to a family member and I will not be representing them

Best bet then would be to speak to the accountant/tax professional who will be advising your family member.

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26th May 2019 20:25

Accountant A - thank you again - however I am really trying to reach out to anyone on this forum who has experience with entrepreneurs relief.

I am currently speaking to several tax accountants and all have different levels of experience and answers to this question. I am hoping to get some advice on here (eg: a yes it is applicable or no it is not or speak to this specific person - they are an expert in this field).

I therefore kindly open the floor to others on this website who have any helpful advice.

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to ACCAGOAT
26th May 2019 21:20

I am not an accountant, but I do have some experience with ER and have looked at some of the court judgments. This, however, is a fact specific question that really has to be handled by getting some paid advice.

Superficially I think you would face some timing problems at least.

Asking anonymous questions on a forum is a dangerous way of taking an issue forward as there may be key facts that you have not referred to and hence any advice would be difficult to rely on.

Professional indemnity insurers would also discourage professionals from providing advice this way as even though it would be difficult to sue there is always a risk of litigation. (Hence my disclaimer about not being an accountant).

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27th May 2019 07:49

The previous respondents are correct.

ACCAGOAT wrote:

The disposal of the business in 2016 is not a text book disposal

Knowledge of that not-a-textbook- disposal qua disposal(*), knowledge of how it was treated for tax and knowledge of how it should have been treated for tax, if different (which, let's face it, is not unlikely) are I suggest prerequisites for any meaningful answer to your question.

(*) or disposals. I think there's likely more than one.

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By Matrix
27th May 2019 08:29

How has the son been running a hotel business without the use of a hotel?

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to Matrix
28th May 2019 09:18

Exactly the same question occurred to me. Shame it hasn't been answered.

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to SteLacca
28th May 2019 09:45

I don’t understand the question or what period the assumption relates to. Please explain your question more fully and I can answer.

Kindest and warmest regards

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27th May 2019 10:51

Thank you all for your comments so far.

I will be seeking paid advice but I am trying to gain some opinion or a name/ firm who are experts in field (and google is not helping on this one).

I will try one last time on this thread....

If anyone has any experience with this type of question - please can you reply on here (either to ask a further question for more info - which is relevant to my first question - or to point me in the direction of a willing expert).

In the kindest way possible - If you can’t help or do not wish to - please simply refrain from leaving a comment - in order to keep this thread straightforward for other readers in future.

Kindest regards

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By Matrix
to ACCAGOAT
27th May 2019 12:24

You could look up an expert on the Tax Advice Network.

You seem to only want answers but your family member hasn’t really helped themselves by not taking advice at the outset. So don’t take the comments personally.

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to Matrix
27th May 2019 13:46

Hi Matrix,

Thank you for your response. You have provided me with what I was looking for.

I did not know about the Tax Advice Network - I have had a quick look and this looks like the place to go. Thank you again.

You are correct, I am on the “answers forum” unashamedly looking only for answers (either directly to the question or a pointer in the right direction - which you have provided - again thank you for this).

My family member has been poorly advised in the past, hence why I am here.

For the record - I have not taken anything personally. Just trying to focus the discussion in the kindest way possible.

Once again Matrix - thank you - your comment regarding tax advice network has pushed me in the right direction.

Kindest regards

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