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Our clients Mr A and Mr B each own 50% of four companies. They have decided to go their own ways and have agreed that Mr A will take one company and Mr B will take the remaining three.
In doing so they agree to sell to each other their respective 50% holdings at a nominal £1 each.
However as part of this deal a number of inter-company loans and debts will also be written off and a large part of a company overdraft will be paid off.
The net result is that the three companies being taken by Mr B will be better off to the tune of £250 000 relative to their pre-deal position.
How does one account for this and what are the tax implications? A couple of thoughts occur to us.
Although the net benefits arise in the companies it seems to...
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
