You might currently be running a number of companies but your current structure may not be the most commercial or tax efficient solution. You might find that a corporate restructure can make the running of your business more stream-lined, resulting in more business opportunities available to you.

Given the complexities that could accompany a corporate restructure and the myriad of tax laws, it is important before any restructure that the appropriate tax advice is sought. Signature Tax can provide the tax advice you need and also propose the best possible way to restructure your company.

SHARE FOR SHARE EXCHANGE

Share for share exchanges are implemented in a variety of company reorganisations. A common transaction is where an individual and his business partner might hold all the shares in various companies but wishes to bring all the companies under one holding company.

The benefits of having a group structure can include the following:

  • Group relief losses/gains between the group companies
  • Inter-group transfers of assets (such property or Intellectual property) will be at no gain/no loss for capital gains tax purposes
  • Risks are ring-fenced within each subsidiary
  • Future disposals of certain businesses can be via a share sale and due to the potential availability of certain reliefs for companies disposing of shares, the share sale of a subsidiary could occur at no capital gain chargeable to tax.

Whilst having a group structure can be commercially beneficial, it is important that the share for share exchange is implemented to ensure that the transaction is undertaken in the most tax efficient way. If the correct advice is not sought, then the share for share exchange could be liable to capital gains tax and stamp duty on the transfer of shares.

If you are looking to establish a group structure via a share for share exchange, we can assist you with this by providing the necessary tax advice and also implementing the share for share exchange in the most tax efficient way.

DEMERGERS

It might be the case that you already have a group of companies, but you and your business partner wish to go your separate ways and split the group companies up. The separation of the companies and assets can be achieved by undertaking a demerger.

There are a few different types of demergers; a direct statutory demerger, an indirect statutory demerger or a capital reduction demerger.

Each type of demerger has certain conditions that need to be satisfied and it might be the case that one route would be more suitable than the other.

A demerger is a complex series of transactions and Signature Tax can help with advising on which demerger would suit your scenario, providing the required tax advice and implementing the demerger. 

Our team works in partnership with organisations to diagnose and overcome the issues they face. Through our international network we’re also able to draw upon local knowledge for cross border restructuring assignments.

We advise stakeholders on crisis stabilisation, turnaround strategies and planned restructuring plans.