Selling a Business

Making sure that you get the right reward, and protecting it when you exit the business.

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Exit Strategies

There are two main reasons for building a business:

  • To generate income.
  • To create an asset to sell.

For some entrepreneurs building a business for sale is their primary goal. They deliberately set out from the start to build value in their business.

Many business owners, however, set out to generate a good income for themselves. But that doesn’t mean the business has value as it’s generally built around the individual; so it has merely a nominal value. Some business owners discover they have created a business with some value that they can sell, but it’s business owners who build asset value that have a saleable business.

If you’re looking for a pot of gold at the end of the rainbow you must understand what is of value in your business, identify the weaknesses and address them.

Don’t rely on the stories of people getting pay-outs of ten times their earnings. You’ll need to plan carefully and well ahead of the sales if you want to maximise your return.

Our team of business advisors at Friend & Grant has the experience and knowledge to:

  • Provide an honest opinion and valuation for your business.
  • Advise what changes you need to make to generate value and how to prepare the business for sale.
  • Assist with preparation of the materials needed for the sale; management information, budgets and forecasts and strategic and business plans
  • Inform you of the tax consequences of the sale regardless of the situation.
  • Advise and guide you on management buy-outs or management buy-ins.
  • Support you in preparing structures and formulating finance packages for you to leave the business. Deferred consideration is often used to enable management to take over a business.
  • If you’re an existing shareholder in a company and want to exit, we can advise on your options, such as a company buy-backs of own shares. That is a popular and tax beneficial way for a business owner to retire from a business or to be bought out. We have dealt with many company buy-backs.
  • If you are passing the shares on to the next generation we can advise on the tax consequences.

Importantly, we’ll advise you on the inheritance tax consequences of your exit.  In most cases, your business asset will qualify for business property relief and therefore be exempt from inheritance tax. Once you sell your business, however, the proceeds will most likely become liable to inheritance tax. It is therefore vital that the IHT consequences are high on the agenda when considering your exit.

Mark Devaney
Effective Web Solutions Rochester, Kent

Starting out in business can be a very daunting prospect as you enter the world of tax and employment law, as well as having to learn to undertake roles required in business, book keeping, management, marketing and sales etc.  This is where I believe Friend & Grant Ltd differ from other accountants.

Any accountant can balance your books and submit your accounts however Friend and Grant do much more than that.  Over the past 13 years Mark and his staff have helped me expand my simple service company into multiple Limited Companies selling internationally, employing a range of staff and owning our own property.

Friend & Grant Ltd is a modern, forward thinking and progressive company and is much more than just a firm of accountants.  Their friendly and approachable staff are always my first port of call when I need any business advice and I trust them completely to manage my financial affairs in a 100% professional and tax efficient way.  I have no hesitation in recommending the services and staff of Friend & Grant Ltd to any business.  They have taken the time to understand my business and provide me with professional and knowledgeable service whenever I need it.

 

 

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Are you hungry for success? If you run a small to medium size business and you want to grow your sales, increase profitability and pay less tax then you have come to the right place.