If a company shareholder wants to exit a business due to a dispute, retirement or to pursue other 
opportunities a company purchase of own shares is always a worthwhile consideration.
The normal treatment of a company purchase of own shares from an individual is that the proceeds are taxed as a distribution in the hands of the exiting shareholder.
However, if certain key tests are met the monies received are treated as capital. This can be a huge advantage where the shareholder meets the conditions for entrepreneurs’ relief as he will suffer capital gains tax at only 10%.
Structuring a company purchase of own shares so to meet the criteria for capital treatment can often be difficult and there are numerous pitfalls associated with mishandling this situation.
Case Study: Company purchase of own shares
Where a company shareholder wants to exit the business due to a dispute, retirement or to pursue other opportunities, a company purchase of own shares is always a worthwhile consideration.
Read case studyOur team at Bedrock has significant experience advising on all aspects of company purchases of own shares and has a 100% track record in obtain clearances even in difficult or complex circumstances.
