Thank you - good advice. Yes I have insisted that they use a lawyer to draft SA, revised articles , warranties etc. They are effectively working together at the moment but 1 = 1 will equal 3 and the financial organisation will be giving them alot of support as they are very good at what they do!
Both businesses are in the finanacial services sector and they are both "partners" in a large organisation.
They receive commission from this organisation on a monthly basis - Initial Advice Fees and Ongoing Advice fees based on the level on the investment value of business written.
The £250k gain for the sole trade I have been informed by a tax expert qualifies as Incorporation Relief, as B i srecieving shares for his trade.
There are no tangible assets; B is keeping any cash he has generated in the sole trader business.
There are loans in a Ltd - B is very aware of this. as A had PG's for these. For this reason there is no desire for a newco
Both businesses have been independently valued and the values are virtually identical - hence the 50:50 split.
Main question I would like answered is the accounting ie Dr Goodwill £250k Cr Shares £100 Cr Share Premium £249,900 ?
My answers
Thank you - good advice. Yes I have insisted that they use a lawyer to draft SA, revised articles , warranties etc. They are effectively working together at the moment but 1 = 1 will equal 3 and the financial organisation will be giving them alot of support as they are very good at what they do!
Both businesses are in the finanacial services sector and they are both "partners" in a large organisation.
They receive commission from this organisation on a monthly basis - Initial Advice Fees and Ongoing Advice fees based on the level on the investment value of business written.
The £250k gain for the sole trade I have been informed by a tax expert qualifies as Incorporation Relief, as B i srecieving shares for his trade.
There are no tangible assets; B is keeping any cash he has generated in the sole trader business.
There are loans in a Ltd - B is very aware of this. as A had PG's for these. For this reason there is no desire for a newco
Both businesses have been independently valued and the values are virtually identical - hence the 50:50 split.
Main question I would like answered is the accounting ie Dr Goodwill £250k Cr Shares £100 Cr Share Premium £249,900 ?
For various reasons the owners do not want to do this
Sorry it was a typo - meant CGT !