Meeting room team 2

Blog

Tax Bite – Refresher on Demergers

Demergers are popular as a way of separating trades / businesses (including investment businesses) in a tax efficient manner. They can be used in preparation for a sale, prior to an investment, or just as a commercial strategy to ring-fence one business or asset base from another. Broadly, provided they are correctly structured they can allow for this with no or minimal tax leakage. Over time...

Read more

Property Tax Bite – Multiple Dwellings Relief abolished – but better news on “mixed” purchases

The Budget on 6 March contained one significant SDLT announcement which had not been seen coming, the abolition of multiple dwellings relief (“MDR”). MDR was introduced to the SDLT regime in 2011 and provides relief for purchases of, as the name suggests, multiple dwellings acquired in, or as part of, the same transaction (or across linked transactions) and essentially means SDLT is calculated on...

Read more

Tax Bite – Employee ownership trusts (EOTs) survive Budget unchanged

EOTs were introduced to promote employee ownership of companies, and the tax benefits (the principal one of which being a complete CGT exemption for the selling shareholders on the sale of a controlling stake in the company to an EOT, subject to various conditions) were intended to encourage such transactions and ownership structures. A consultation into EOTs was announced as part of Budget 2023...

Read more

Tax Bite – EMI share valuations – recent developments

Tax Bite – EMI share valuations – recent developments In addition to the considerable tax benefits of enterprise management incentive (EMI) options, the ability to agree with HMRC the market value of shares to be placed under EMI options is another really attractive feature of this type of share incentive. Outside of EMI and CSOP options, it is generally not possible to seek HMRC’s agreement to...

Read more

Tax Bite – Hive-downs

Where a corporate seller is selling a business, instead of selling the business and assets directly to the buyer, a more attractive alternative can be to hive down the business into a (new or existing) subsidiary company, and sell the subsidiary company to a buyer. Hive-downs can be more attractive from a corporate seller’s tax perspective than a direct transfer of a business / assets to the...

Read more

Tax Bite – W&I insurance-backed M&A deals – Cover for tax liabilities

Warranty and indemnity insurance is now a common feature in M&A deals. Sellers will typically anticipate at the outset that if the deal is backed by W&I insurance, their liability under the SPA warranties and Tax Covenant will be capped at £1. What is often not appreciated (sometimes by buyers and sellers alike) is that there will be a number of things that a Tax Covenant (and Tax...

Read more

Tax Bite - EIS deferral relief/SEIS reinvestment relief: often forgotten

EIS deferral relief/SEIS reinvestment relief: often forgotten The Enterprise Investment Scheme (EIS) is a UK venture capital scheme renowned for the generous tax reliefs it offers investors when investing in private companies. Along with its related relief (SEIS, for smaller start-up companies,) it provides income tax relief on the amount invested and a CGT free exit if all the conditions are met...

Read more

Tax Bite - Alternatives to EMI Options

EMI options are the most attractive form of employee share incentives available, however they won’t always be available, for example where:The company is too big, in terms of numbers of employees or gross assets; The company carries on EMI-excluded activity or has investment activities; The individual is not a full-time employee; The individual already has £250,000 worth of EMI options, or...

Read more

Tax Bite - Royal Assent to the Finance Bill – Changes for tax-advantaged share options and share investment

On 11 July 2023, the Finance (No 2) Bill 2023 received Royal Assent. This has given effect to a number of relaxations and increases in limits relevant to tax-advantaged share options and share investments: Enterprise Management Incentive (EMI) Options The requirement to include within the option contract details of any restrictions that apply to the shares no longer applies. As best practice, we...

Read more

Tax Bite - Employment Related Securities / Share Plans Reporting – Deadline Looming

The deadline for employers to report events in relation to employment related shares (and other securities) and share options in respect of tax year 2022/23 is 6 July 2023. Most companies will know that if they operate an HMRC-approved or tax-advantaged share option / incentive scheme such as EMI, CSOP, SIP or SAYE, there is an annual reporting requirement in relation to events happening during...

Read more

Tax Bite - Highlights of “Tax Day” – Stamp duty reform, and possible changes for EOTs?

Tax Bite – Highlights of “Tax Day” – Stamp duty reform, and possible changes for EOTs? Last Thursday 27 April was “Tax Administration and Maintenance Day”, which involved the publication of various consultations and proposals on tax measures, and the promise of more consultations to come. Of most interest to those advising companies and their shareholders were: The announcement that there will be...

Read more

Property Tax Bite - “Tax Day” – Possible reforms to the Construction Industry Scheme

Property Tax Bite – “Tax Day” – Possible reforms to the Construction Industry Scheme Last Thursday 27 April was “Tax Administration and Maintenance Day”, which involved the publication of various consultations and proposals on tax measures, and the promise of more consultations to come. Of most of interest to those advising on property tax matters was the publication of a consultation on proposed...

Read more

About us

Parisi Tax is a specialist tax law firm. Our clients benefit from having on-demand access to a wealth of tax knowledge and deal expertise.

Services