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Structuring a company sale to acquire the goodwill of a business.
Further to the query ‘Winding it up’ (published with replies in Taxation 17 August 2017 page 24) we have a similar situation that is causing us concern. Our client is a sole practitioner medical professional and is seeking to sell his company X Limited to another corporate Y Limited.
X Limited has assets of: £150 000 old-style goodwill with a historical cost of £250 000; an overdrawn loan account of £150 000; and sundry creditors of £80 000.
As far as we are aware there are no CTA 2010 s 455 issues here. Y Limited a third party has agreed to buy X Limited for £400 000 to obtain the benefit of the goodwill of the business. To avoid having to pay a dividend to clear the overdrawn loan account we have suggested that our client X Limited ...
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
