Ltd Company - demerger?

[marlint]

I'm currently owner and sole-shareholder of a small profitable Ltd company (Company A) which trades online.

In the last six months, Company A has developed a new business opportunity, and it is now at the point where I have found investors to invest in this new line of business.

I'd like to split out this line of business into a separate company (said investors have no interest in original line of business, and I want to keep it separate).

What are the options surrounding this (I know I should, and will talk to my accountant, but I want to know what to research before I do so).

All I've found so far is the concept of a 'demerger' but this looks pretty complicated (e.g. needing to get approval from HMRC, restrictions on future sale etc).

Thanks in advance...

 

[Paul_Rosser]

Will your new company be taking any assets from Company A ? Employees etc ?

You could start a new company called say Company B and either have it as a seperate entity from Company A, or create a group structure with both companies in one group.

The advantage of a group is that you can use group tax relief and other such things, but they generally cost more in terms of accountancy fees.

 

[marlint]

Will your new company be taking any assets from Company A ? Employees etc ?

You could start a new company called say Company B and either have it as a seperate entity from Company A, or create a group structure with both companies in one group.

The advantage of a group is that you can use group tax relief and other such things, but they generally cost more in terms of accountancy fees.

Paul,

Thanks for your reply. Yes there'll be around £4000 of fixed assets to be transferred, no employees though. There's also the 'goodwill' of the business itself (there's a brand, and roughly £10,000 annual turnover associated).

I'd like to steer clear of any group structure (keep things simple for my investors). Ideally, I'd just like to transfer the assets at nil cost, but I imagine that wouldn't be allowed!