Seeking pro advice re cross-border share purchase

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I’m a non-UK resident with shares in a UK company. I’d like to sell these shares to a foreign company and have the earnings distributed over, then strike off the UK company.

I have a fairly clear understanding about what's involved but I'm not an accountant and would like to talk the process through with someone who knows UK tax law and has some understanding of the international aspect.

Replies (11)

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Caroline
By accountantccole
20th Nov 2023 13:02

What country are you in? The response to your question is likely to depend on that as not all double tax treaties are the same

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Replying to accountantccole:
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By dhan
20th Nov 2023 14:26

I'm in Belgium.

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By dhan
21st Nov 2023 16:45

Ignoring the international aspect of my question: if Company A distributes all remaining profits to Company B (the shareholder) and is then struck off, would HMRC reclassify this distribution as income rather than dividends?

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By taxdigital
22nd Nov 2023 07:57

dhan wrote:

I’d like to sell these shares to a foreign company and have the earnings distributed over, then strike off the UK company


Once you have sold the company by transferring the shares, how can you shut the company down?

dhan wrote:

I’d like to sell these shares to a foreign company and have the earnings distributed over


No, you as the vendor get paid for the shares sold: the company gets nothing on disposal of the shares so what’s there to distribute?

dhan wrote:

I have a fairly clear understanding about what’s involved


No; you don’t have.
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Replying to taxdigital:
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By dhan
22nd Nov 2023 09:34

I haven't included all the details since I'm looking for somebody who can give me paid advice on some of the details. Basically I own both companies, but distributing the dividends to myself directly in the UK will mean I pay a higher tax rate then if I can distribute them to myself from the local company at a later date. I'm a foreign tax resident and can claim exemption on personal UK taxes but need to know any other possible consequences of the share sale and intra company distribution.

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Replying to dhan:
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By Leywood
22nd Nov 2023 10:03

Do a google search for an Accountant in Belgium and the UK and choose a medium sized firm that will also have a tax department.

Type in 'find an accountant' and add the words ICAEW or ACCA.

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Replying to taxdigital:
By Ruddles
22nd Nov 2023 10:11

The OP might have a clearer understanding than you give them credit for. I immediately read the question as follows:

OP is going to sell the shares in his personal UK company to his personal overseas company, for €x.

UK company will then distribute its reserves to overseas company. Application then made to strike off UK company.

All seems simple enough, but who knows, I may have misunderstood.

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Replying to Ruddles:
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By dhan
22nd Nov 2023 11:12

That's exactly it. I just want to make sure there are no unforeseen consequences from the distribution and subsequent strike-off.

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Replying to dhan:
By Ruddles
22nd Nov 2023 12:11

What is the UK company's tax residence status? If currently (correctly or otherwise) treated as UK resident, might the acquisition by the Belgian company change that? In which case you might be looking at exit charges depending on what assets the company holds. (Although it would probably otherwise be looking at the same charges arising on transfer of relevant assets to the new parent, so no great shakes.)

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Replying to Ruddles:
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By dhan
22nd Nov 2023 16:17

Yes the UK company is treated as a UK resident. Remaining assets are just cash. These charges would be payable by the UK company I assume?

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Replying to dhan:
By Ruddles
22nd Nov 2023 16:21

If there is nothing left but cash then there is not any obvious UK tax issue.

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