Member Since: 5th May 2010
8th Aug 2019
Thanks - Yes. Will post response from HMRC once received
7th Aug 2019
Thanks - once you've done that can you confirm your conclusion?
If all the dividends simply pass through to Mr B, there is no income tax advantage, this is a bringing forward of a CGT liability to crystalise a gain
2nd Apr 2019
Why wouldn't there be SDLT? If it's a market rate purchase, then there would be SDLT, and even if there was a gift, since there is a debt, I thought this would represent consideration?
2nd Apr 2019
The commercial reason is that without a change in structure then there is a risk that the individual is unable to complete the contract.
If the limited company purchases at full market value, no question of any discount or premium, then there is no CGT impact, and at this time no income tax either. Do you still foresee an issue?
20th Mar 2019
Apologies - yes purchased by directors. Articles and shareholders' agreement will be amended as necessary to allow non natural shareholders.
30th Nov 2017
However,given that they are both directors without contracts I wasn't expecting minimum wage to apply.
30th Aug 2017
Just spoken with HMRC this morning regarding a paper return submitted early July and received by HMRC on 5 July. Expected processing date ......5 October - with a further 3 weeks for processing the refund (Assuming that it is not pulled for further review!)
17th Aug 2017
Thanks Justin. Having performed more research, then the answer sadly appears to be "with difficulty".
I had rather much hoped that I was ignorant of some HMRC clearance which provided the opposite clearance of share for share exchanges when inserting a holding / parent company. It seems not.
Thankfully the companies are not worth a lot (hence one of the reasons to simplify), and any tax on a distribution may be acceptable.
16th Aug 2017
The rationale is the ease (or relative minimal disruption). All trading contracts, leases, employees, credit rating, VAT numbers, stationery etc are all in the subsid and to transfer these will be at considerable expense.
The potential for incorrect conclusions to be drawn from a transfer now, and credit lines not being available, albeit temporarily, until a history has been formed make the striking out of a dormant parent, which does nothing much more attractive.
16th May 2017
Thanks SteLacca, yes new engagements and authorisations are being completed now the acquisition is complete.