Selling a Limited Company and Shares

VickyRoss1305

I have a client who is selling there Limited Company.

I have two questions

1. The client is VAT registered and currently uses the retail apportionment calculation how do I deal with this when charging VAT on the sale of the business?
2. There are currently 2 unpaid shares on the balance sheet. Do these need to be sold separately or can they be surrendered with the sale of the business?

I have dealt with this before so am very grateful for your input :-)

VickyRoss1305

The monies discussed at present are for the assets of the business (corner shop).

VickyRoss1305

mrme89 I apologise if my information is a little patchy.

the business will be sold as a TOGC yes as the buyer will continue to trade with the assets they are purchasing. So I now feel more confident in saying that the VAT is not an issue.

What about the shares mrme89? Do these get dealt with separately or are they part of the TOGC?

MarieNoelle

Is the Ltd Company (vendor) retaining any assets? What are the intentions of the seller, i.e do they want to wind down their company?

VickyRoss1305

Hi Marie yes the intention of the seller is to walk away from the company and never turn back :-)

I believe at this moment in time that the business will be sold as a going concern and everything will be transferred to the buyer on the balance sheet.

I am unsure at this stage if the company will be transferred for the buyer to change the name or if the company will be closed down after the transfer......

The information I have is very vague at this moment and I just wanted to get my end straight as I don't deal with these TOGC everyday.

VickyRoss1305

Thank you mrme89 they bought this business themselves as a going concern in 2011 so ER wont apply to them will it?

MarieNoelle

ER won't apply to the assets including goodwill as it is the company selling the assets. But ER may be claimed on the future disposal of shares held by the individual if the conditions are satisfied.

MarieNoelle

Completely agree @mrme89 I was just making the comment because I think Vicky was getting confused with ER on goodwill.

VickyRoss1305

Thanks guys for all your input I really do appreciate it and will use this forum more often. You have given me lots of food for thought :-)