Outside of the economic and political uncertainty that Brexit is bringing, two key things are showing their colours this month:
- Protection of hard earned company assets particularly trading premises
- Changes to Entrepreneur Relief
Both these aspects of business structure and restructure require careful consideration and planning and are both key to the ultimate exit strategy of any business owner(s).
The removal of the trading premises of a company into a holding company or a pension vehicle has become increasingly prevalent. There are pros and cons to this strategy and implications of tax, security and balance sheet values need to be considered carefully before the transaction is entered into. However, the ring fencing of assets outside the trading vehicle is a proven strategy and should be seriously looked at.
The recent 2018 Autumn Budget has had some significant changes on the Entrepreneur Relief rules and therefore any share or EMI structures/restructures need to be reviewed/planned carefully in order to ensure that this relief is still applicable.
Main changes are:
- the holding period being extended from 12 to 24 months
- changes to the 5% ownership rules and the addition to voting rights of distributable profits and net assets on distribution
Developing an exit strategy is critical to any business and therefore needs to be reviewed, considered and implemented on an ongoing basis.
If you need help with any of the above, contact us on 01482 427360 and remember, think Exit not Brexit as you look at the future of your company.