Corporate finance – Disposal of Business & Retirement

Client S had a distribution business producing profits. The client owns 100% of the share. The company has accumulated profits after years of operation with cash deposits. The client was considering retiring but wanted the cash out of the company. He was not quite sure what the options were.

BMOL Partners advised that the owner qualified for retirement relief and that a substantial portion of the proceeds would be tax free. BMOL Partners advised him not to distribute the cash in advance of the sale as this would attract tax at his marginal rate of tax – over 50% with levies.

BMOL Partners organised the payment of a portion of the cash in the business to his pension scheme, and then organised the sale of the business. A substantial portion of the sales proceeds were tax free and the client retired.