Capital allowances are allowances given by the government to offset tax payable when a business purchases an asset that is “Capital” in nature. These will typically be assets that you use in the business, that are held long term to assist the business in generating profits, such as plant and machinery and vehicles.
There is also scope to make claims for relief on the integral features contained within business premises, which may not previously have been claimed. We work with a specialist firm of surveyors to identify available allowances and ensure relief is claimed at the earliest opportunity.
We advise on all pertinent tax issues in buying or selling a business. The tax rules on what qualifies for reliefs and what doesn’t are constantly changing and planning is vital in ensuring tax efficiency over the life cycle of business ownership.
Selling a business or company is also fraught with pitfalls and difficulties and we are frequently engaged to navigate sellers through the process of the business sale to ensure the legal terms that are being agreed do not have any negative connotations for the sellers. We also advise on the likely available reliefs on disposal of the business and how to claim them successfully.
Finally, most business sales involve a process of due diligence and disclosure, which gives both parties to the transaction the opportunity to delve into the detailed financial and legal history of the business. We have experience with making adequate disclosure and reviewing the information disclosed to achieve a good outcome on purchase or sale.
Our aim is to complete the detailed work involved, whilst diluting and conveying to you what the pertinent issues are and ensuring you are aware of, and engaged in, the decisions around taxation on purchase or sale.
Often, after a period of successful operation, a company or group of companies may need to alter the structure of the overall business operation.
There will usually be a variety of ways in which the outcome can be achieved legally, but only careful planning will ensure that any tax reliefs potentially available can be claimed. Getting it wrong can be unexpected and expensive.
After a number of years of successful trading, two directors in a company decided to part ways, because they could not agree on the future course of the business. This business held trading assets of a significant value, which the directors planned to transfer to new companies, controlled by them individually.
Careful planning led to us getting approval from HMRC to undertake a tax free capital reduction demerger, which resulted in a tax saving in excess of £200,000.