FFS - SECOND TIME I TYPED THIS. COULDN'T FIND WHICH SODDING TAG/CATEGORY, WHICH APPARANTLY IS ESSENTIAL, AND IT LOST IT.
Not sure if this is a terminology quesiton or a tax one.
Client sold his company in March 2017 to another company. Received cash plus earnout. Earnout(s) (multiple of profits in subsequent years) to be paid by receipt of loan notes in the buyer AT THE FUTURE dates. ie March 2017 he will receive a loan note in buyerco equal to 130K which is to be redeemed quarterly over 2017/18, in March 2018 he will receive another loan note equal profits for the later year, 2019 etc.
My concern is whether I need to get into the tax on loan notes, securities and s138A or - as I think - these "loan notes" are just the lawful way of quantifying the indebtedness for the next 12 months.
However, surely the above scenario is to quote "a vendor exchanges his old shares for the right to future consideration in the form of loan note means s138A will apply".
I think it's unascertainable deferred - taxed in 16/17. BTW