A new client had a large balance on their Directors Loan Account a few years ago and a very unhealthy looking balance sheet. Their previous advisors allotted 160,000 new ordinary shares and converted the loan account.
They have now had a few successful years and hopefully will continue to do so and are asking whether at some point it is easy to reverse the transaction and go back to just 2 ordinary shares.
I wondered whether this was something anyone can comment on - is it easy to do? (although given I'm in the dark here I would use a co registration agent for the paperwork to make sure it is done correctly) and what are the tax implications (if any) - I suppose the tax element is the main question here as obviously they are wanting to know what this will cost them.
Many thanks in advance I appreciate it.