A popular exit strategy for many business owners and an excellent succession strategy for any business is a Management Buyout (MBO). This can present an exciting opportunity for a management team to pool resources and purchase all or part of a business, driving it forward, funded internally or with external finance. This can also facilitate a Family Management Buyout (FAMBO) or a Management Buy-In (MBI) usually with private equity backing.
Our specialists at Fairtax understand each transaction has its own complexities and we are on hand to support you through each stage, from initial assessment, planning and structuring, through to execution and completion.
Succession Planning With significant Tax Savings
Passing your business to the next generation or a management team can be a big decision and you will naturally wish to ensure that this is structured in a smooth and tax efficient manner. The tax rate applying to initial and deferred sale consideration (e.g. paid over a number of years) is generally 10% for those eligible for entrepreneurs’ relief where you retain not more than 25% of the buy-out/successor company, with the benefit of tax clearance obtained in advance from HMRC. Similar benefits are also afforded where your shares are repurchased by the company, subject to satisfying certain tax and legal conditions.
We are also on hand to assist your successors to take the business forward with confidence and financial security.
We can take the stress out of your succession planning whilst helping you to extract the maximum value from the many years of hard work that you’ve put into growing your business.
Our experts will ensure the most tax efficient structure for your transaction by:
- Conducting an initial feasibility assessment to ensure this is the right option for you; suggesting suitable alternative options if this is not the case
- Structuring your succession plan to optimise tax savings, tailored to extracting cash to meet your ongoing requirements
- Assisting with business planning, financial forecasting and business valuation
- Supporting negotiations with financial backers, vendors and their advisors
- Implementing a structure designed to capture available tax reliefs
- Tax clearances
- Providing end to end project management
With our years of experience in managing MBO’s and MBI’s, we’ll ensure your transaction is supported every step of the way to its successful completion. To find out more, speak with one of our specialists today…
*Actual savings on tax will depend on the specific circumstances of your situation and your tax/ earnings status
Get in touch
For immediate advice and guidance on your succession plans, please contact Stephen Elliott, Patrick Morris or Roger Phillips on 0333 577 1940. Alternatively you can fill in the enquiry form at the footer of this page.
Need more information on Succession Planning?
We’re here to help. If you have any specific questions you’d like to ask our team, in complete confidence, please email us at email@example.com and we’ll reply within 24 hours. Please also state whether you would like a call back. Fairtax is a trading division of Fairhurst, an accountancy firm with a 70 year pedigree in handling both personal and business tax matters.