Many company sales entail part of the consideration being satisfied in the form of loan notes issued by the purchaser. Most ‘owner-manager’ sellers will wish to obtain enterpreneurs’ relief (ER) on their loan note consideration by making a s 169R election (in the case of QCBs) or a s 169Q election (non-QCBs). However, they must recognise that in both cases, the statute does not allow them to reduce their taxable (ER) gains if the acquiring company gets into financial difficulties and the loan notes become a bad debt.
