Restructuring your business is tricky, especially when moving shares, directors or investors. Before you act, it is vital to consult commercial solicitors and accountants, lest any hasty changes land you with an unwelcome tax bill. In this video, Will Conway explains what can happen if you don’t seek the right advice before attempting a reorganisation.
How to Restructure Your Business: Transcript
Are you thinking about restructuring your business? Allotting, acquiring or redesignating shares? Adding new directors or bringing in investors? Clients often approach us with these kinds of proposals, and they can be a smart move if you do it right.
One of our clients had undertaken a reorganisation which involved moving various shares around and changing the structure of its group. Unfortunately, the firm they had instructed hadn’t advised them to obtain advice from accountants on the potential tax consequences. They thought they were being clever until they got hit with an unexpected tax bill that wiped out their profits. Another client came to us having accidentally given up control of their own business by issuing shares without a proper agreement in place.
It’s important to remember that any kind of restructuring isn’t just about moving things around to make them tidier. These kinds of actions will have tax implications, may affect ownership and voting rights, and, if mishandled, could even hamper your ability to sell the business later. Before making changes, get legal and accountancy advice. A little planning now can save you a lot of money and a lot of headaches down the line.
Have Questions About Restructuring Your Business?
If you’re unsure how to approach reorganising your business, Newton Solicitors can help. Our commercial law specialists will advise you on every step and guide you through the legalities of moving shares, directors or investors. Please contact us today.