Having a UK Hold Co with a UK Subs. We want to potentially sell the UK sub to a 3rd party.
The rationale is that if Holdco sold one of its subsidiaries that the basis in the shares would used to determine any tax gain in a share sale to a third party?
What about in a liquidation or insolvency?
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Member Since: 4th Dec 2020
accountingdude
SSE? Tax liquidationHaving a UK Hold Co with a UK Subs. We want to potentially sell the UK sub to a 3rd party.
The rationale is that if Holdco sold one of its subsidiaries that the basis in the shares would used to determine any tax gain in a share sale to a third party?
What about in a liquidation or insolvency?
I don't actually know what the question is. The answer might be that a company won't pay tax on a share sale of a subsidiary to a third party. But I suppose the answer may be something else entirely once I find out what the question is.
Yes a solvent liquidation of a subsidiary can be passed up tax free. Inter group transfers are tax free.
However why liquidate it? The Company could just sell everything and be left with a just bank balance. Dividend it up (no tax) then DS01 strike off.