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Readers’ forum: Which information should I include in the white space?

19 February 2024
Issue: 4925 / Categories: Forum & Feedback , Investments
Gift or proceeds?

My client was a minority shareholder in a company that was sold last year. After the sale the purchasers discovered a fraud and the various vendors had to repay some of the proceeds in accordance with the warranties and indemnities.

I am satisfied that that reduces the proceeds for CGT. My client helped negotiate the amount with the purchasers and make sure the problem did not escalate.

He did this for his own interest and because he is good at that sort of thing; he did not expect that the majority shareholder would after the event give him an amount equivalent to the proceeds that he had to pay back under the warranty.

As far as I can see he has a capital gain based on the reduced proceeds and quite separately a non-taxable gift from the majority shareholder which was simply a...

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