From the flames

Is Extra-statutory Concession C16 applicable in the following circumstances or is it tax evasion? During March 2008 a client without my knowledge took advice from a third party to dissolve his successful limited company XYZ (International) Ltd in which there was a substantial bank balance. Exactly the same activities were carried on from the following day in a new limited company named XYZ Ltd.

Both companies had the same director/shareholder used the same website for selling the same product and XYZ Ltd took over all the stock and other assets of XYZ (International) Ltd. The object of course was to extract the bank balance at 10% under the old capital gains tax regime rather than by dividend/salary. If this is deemed an acceptable ploy then twelve months later the same action could be enacted using a new company XYZ (One)...