Sale of business and vehicles

[Helen Williams]

We have received an offer for our business sale which we are currently considering. I am Company Secretary and have a Nissan Navara of which I am registered keeper. The Navara was purchased through the business and has no outstanding finance on it. My husband is Director and we wish to retain our vehicles. Both are commercial and haven't got vast values. Could my husband "gift" my Navara to me prior to the sale of the business going through? I know we are able to purchase them out of the business and corporation tax will be charged as a sale. I just feel we have worked for 30 years and have never been greedy in what we have taken out of the business financially. Would it be acceptable to receive my vehicle as a gift or would we need to buy it? I am just looking for the most tax efficient solution to keep my truck. Any advice would be much appreciated. This is a massive step for us. We do have a very good accountant but I don't want to keep bothering him when the sale isn't formally agreed yet. Many thanks.

 

[DWS]

Of course your husband can gift you the vehicle but it is not his to give, it belongs to the Company and even if it is a gift there will be tax consequences, queries like this is what you pay your accountant for so you shouldn’t feel that you are ‘bothering’ him.

 

[Paul Kelly ICHYB]

The business owns the vehicle and will have a value to the business and, surely, would be part of the sale, as it would be on an asset register??

Speak to your accountant, who should understand the bigger picture. Maybe buy it for a nominal sum?

 

[Baines Watson]

We have received an offer for our business sale which we are currently considering. I am Company Secretary and have a Nissan Navara of which I am registered keeper. The Navara was purchased through the business and has no outstanding finance on it. My husband is Director and we wish to retain our vehicles. Both are commercial and haven't got vast values. Could my husband "gift" my Navara to me prior to the sale of the business going through? I know we are able to purchase them out of the business and corporation tax will be charged as a sale. I just feel we have worked for 30 years and have never been greedy in what we have taken out of the business financially. Would it be acceptable to receive my vehicle as a gift or would we need to buy it? I am just looking for the most tax efficient solution to keep my truck. Any advice would be much appreciated. This is a massive step for us. We do have a very good accountant but I don't want to keep bothering him when the sale isn't formally agreed yet. Many thanks.

As mentioned above by others it is owned by the company so not really for your husband to gift.

This is the type of question / advice your accountant is there for so do make use of his time as he is the one best placed to give you tailored advice being familiar with your personal and company financials.

If you want to keep the sale confidential from him for the moment then just ask about the most tax efficient way to take the company vehicle out into your personal ownership.

 

[fisicx]

Maybe buy it for a nominal sum?

There have been threads about this. HMRC takes a dim view of assets being sold off under value.

 

[MyAccountantOnline]

We have received an offer for our business sale which we are currently considering. I am Company Secretary and have a Nissan Navara of which I am registered keeper. The Navara was purchased through the business and has no outstanding finance on it. My husband is Director and we wish to retain our vehicles. Both are commercial and haven't got vast values. Could my husband "gift" my Navara to me prior to the sale of the business going through? I know we are able to purchase them out of the business and corporation tax will be charged as a sale. I just feel we have worked for 30 years and have never been greedy in what we have taken out of the business financially. Would it be acceptable to receive my vehicle as a gift or would we need to buy it? I am just looking for the most tax efficient solution to keep my truck. Any advice would be much appreciated. This is a massive step for us. We do have a very good accountant but I don't want to keep bothering him when the sale isn't formally agreed yet. Many thanks.

Please don't do anything before speaking with your accountant - you aren't bothering him you are a paying client that wants and needs advice. That's what accountants do!

Talk to your accountant about the business sale it may save you a lot in tax!

 

[Clinton]

Hi everyone, anybody remember me? I took a bit of a break, meant to come back in a year, but forgot about it for a while. Someone alerted me to this thread so I thought I'd make some comments. You'll can all jump in with "welcome back", send flowers, buy me champagne, whatever.

On topic...

As already pointed out, the vehicles belong to the company. If a buyer has made an offer for the business based on the current state of play, he's not going to be best pleased if you remove assets. It's like agreeing a price for the sale of your house and then insisting you're going to continue occupying the garden!

The buyer's offer is for everything in the business, including vehicles. If you want to remove assets, you need to renegotiate the price!

Also, as pointed out, HMRC is not that keen on being fiddled out of tax! Research BiKs and research directors buying assets out of their company. And while you're doing that research, you should really get your head around that whole Ltd company being an independent entity thing. That'll come in handy when your buyer expects you to hand over all the cash in the business bank account!

I just feel we have worked for 30 years and have never been greedy in what we have taken out of the business financially.

What does that have to do with anything?! Who cares how long you've worked in the business or how frugal you've been with your personal needs? There is no place for these emotional cries in a business sale situation. Stick to facts, numbers, accountancy principles and the law!

Which brings me back to another piece of advice you've already been given: go speak with your accountant. Trust me, this is far above your pay grade (or your husband's). There are CGT implications if it's an asset sale, and CT issues. If it's a share sale, there are tax concessions you may be eligible for or you'd end up paying capital gains tax on the full sale price. There are all kinds of other matters on which you're probably completely in the dark. It's worth getting expert advice (even if it means paying for it).

 

[Lisa Thomas]

Welcome back, Clinton!

OP - if business is sold and there is a surplus from the sale then the shareholders should benefit from the distributions. You might even be able to consider a solvent liquidation to save on taxes (subject to any changes in the upcoming budget). Again, all comes down to speaking to the accountants.