It is important to review employment tax issues at the earliest stage before selling a company/business. As part of this, the adviser should: conduct status checks of self-employed individuals (including non-executive directors used through personal service companies); check that any termination payments have been treated correctly for tax purposes, especially where the target company has undergone restructuring in the years running up to sale; and check whether employers have properly deducted PAYE/NICs. Failure to resolve these issues can result in very significant tax costs and may even be ‘deal breakers’ on a potential sale.
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It is important to review employment tax issues at the earliest stage before selling a company/business. As part of this, the adviser should: conduct status checks of self-employed individuals (including non-executive directors used through personal service companies); check that any termination payments have been treated correctly for tax purposes, especially where the target company has undergone restructuring in the years running up to sale; and check whether employers have properly deducted PAYE/NICs. Failure to resolve these issues can result in very significant tax costs and may even be ‘deal breakers’ on a potential sale.
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes: