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Practice guide: Taxing negative consideration

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Corporate deals in today’s market contain some very different features from those which would have been expected a few years ago. One development is sellers receiving only nominal consideration, or even being required to pay a buyer, in order to dispose of a subsidiary company. This can create problems for the unwary buyer in the shape of corporation tax and VAT liabilities, which can be exacerbated if the sale documentation does not include a well-drafted gross-up provision

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