Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Our mutual friend

17 December 2013
Issue: 4433 / Categories: Forum & Feedback , Companies

The client is a mutual trading company that holds an annual conference on which a small profit is made. An events company wishes to buy the conference, and will pay a fixed capital sum followed by five annual payments

Our client is a mutual trading company. It usually breaks even over the year so generally tax is not a concern. It holds an annual conference on which a small profit is made.

The company has been approached to sell the annual conference to an events company. The company will be paid a fixed capital sum of £100 000 up front with five annual payments of £18 000.

In addition it will receive a percentage of future profits from the conference. Bearing in mind that as a mutual trading company any profits are due to be returned to the members are the proceeds of sale of the conferences taxable?

We look forward to replies.

Query 18 311 – Charles

Reply from Steve Kesby

I question on the limited facts provided whether the company is a mutual trading company; alternatively is it...

If you or your firm subscribes to, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or '' for further assistance.

back to top icon