BUSINESS TAX PLANNING
Shipleys’ tax practice has an excellent reputation for innovative and reliable tax planning. Businesses can benefit from practical tax planning at all stages of their development.
Starting up in Business
The first aim of every business, whatever its form, is to make profits for its owners. Usually this means
trading profits that can be paid to the shareholders or partners. However, in some circumstances, the plan
may be to build up the business so that it can be sold for a capital gain.
Our tax specialists can help you to identify the best structure for your business, to minimise the tax both on trading profits and on a sale of the whole business. The business structures we cover include sole traders, partnerships, limited liability partnerships and limited companies (including PLCs), and our advice also covers different classes of shares and profit sharing arrangements.
If you are involved with a limited company which issues shares to other investors, you may need to ensure that the company meets HM Revenue and Customs’ criteria for the investors to be eligible for income tax relief, and that their investments in your business enable them to shelter any capital gains.
It has been common practice for individuals to offer their services through a Limited Company (Personal Services Company) or partnership. These businesses can fall foul of the Inland Revenue ‘IR 35’ regulations. We can assess whether your business is affected by these and suggest changes to the contracts or working arrangements to ensure that, wherever possible, the IR 35 rules do not apply.
If you are entering a business venture with other companies or individuals we can help you structure the joint venture participation for maximum tax efficiency.
Established Businesses
Once the business is up and running, our approach of working very closely with our clients means that tax
saving opportunities can be identified when they arise, as opposed to merely entering the previous year’s results
on the tax return and working out when any liability has to be paid.
Payroll and Benefits
The ways in which staff and stakeholders are paid are very important. We help our clients to ensure that
their strategies are tax efficient. This covers, for example, pension contributions and schemes, share
options, allowances, benefits in kind (including cars) and trusts.
We can also review your Pay As You Earn (PAYE) scheme to make sure that it is being operated correctly, and that you are not building up a big liability which comes to light at an HM Revenue and Customs PAYE inspection.
VAT Planning
Value Added Tax (VAT) is, in theory, a cost only to a business which is not VAT registered or is making VAT
exempt supplies. If a business can maximise the VAT recovered on its purchases, and minimise the VAT on sales,
then this can significantly increase profits.
VAT rules are complicated and there are penalties for failing to comply, quite apart from the effect on cash flow of an unforeseen liability following a VAT inspection.
We can review your business and its systems to ensure that VAT planning opportunities are considered and the risk of non-compliance is minimised.
Acquisitions and Disposals
We have considerable experience of advising on the buying and selling of businesses. This includes not just
the sale of a whole business but also the disposal of a division or subsidiary, or the retirement of a partner
or shareholder. Larger groups of companies may need to undergo a reconstruction prior to a sale.
The terms to be negotiated and agreed do not just include the price. For example, the nature of undertakings and guarantees, as well as the form and timing of the consideration, can be equally important.
It is often advantageous for one party to consider the tax position of the other, since any savings to the other party can be reflected in the price.
For those buying businesses we are able to carry out due diligence for tax purposes on the proposed purchase, to ensure that no previously unforeseen liabilities come to light after the acquisition.
Purchase and sale issues can be quite complicated and many clients have appreciated our hands-on approach, and our ability to drive the transaction process if required. These are areas in which we specialise.
Shipleys’ Tax Team
Not all tax planning ideas are suitable for everyone, but we believe it is important that our clients are
given the opportunity to understand all their options. Tax planning must integrate with other commercial
considerations such as banking and finance facilities.
Shipleys’ specialist tax planning team comprises private practice experts, as well as former Inland Revenue and Customs & Excise staff. They are all very experienced and take pride in recognising tax saving opportunities for clients.