Demerging your business

Talk to us about your plans. Get the benefit of high level tax advice on the complex tax rules governing demerger tax reliefs. Understand your demerger and reconstruction options and their tax implications.

We begin by taking a detailed look at your reasons for considering a demerger. We will check that it is the right solution given your individual circumstances and deliver a tax efficient outcome.

Demergers are often sought:

⦁ before a decision to sell a business – in preparation to maximise the eventual sale
⦁ when selling a company – splitting off trades or investments that are not required by the purchaser
⦁ in the event of a shareholder dispute – allowing disparate shareholder groups to find a way forward
⦁ when a family outgrows its family-owned investment company – splitting the original company into a more appropriate structure
⦁ to separate commercial trades – recognising the need for trade specific management incentives
⦁ to protect the tax status of a trading company or group – protecting Business Asset Disposal Relief and Business Property Relief are dependent on the trading status of a business

Whatever brought you to think about the possibility of demerger, we urge you to talk to us, without obligation as soon as possible. Planning ahead, with our tax team can make a significant difference to your final decision and to your tax bill.

Why use Bates Weston Tax team for your company demerger?

The Bates Weston Tax team specialise in demergers and reconstructions and have structured and advised on many transactions for privately owned companies and groups with values between £10m and £100m.

Our approach, honed through experience, is straightforward. With client service at its core, we develop a clear and shared understanding of the work we will undertake to deliver an effective technical and practical solution, for a fair fee, to a timetable that is agreed at the outset.

Craig Simpson and Richard Coombs, both experienced tax advisors, set up Bates Weston Tax specifically to address the twin concerns often levelled at larger national firms – poor service and high fees. Established in 2016, Bates Weston Tax has gone back to basics, providing clients with the service they want from a cost-effective alternative to larger national firms of accountants.

The approach has been well received. Growing every year, Bates Weston Tax are now tax advisors to many substantial privately owned companies and wealthy families and also provides tax advice to other firms of accountants who do not have in-house tax expertise. In recognition of our specialism, in 2020 the firm co-authored Tolley’s Tax Planning For Owner Managed Businesses.

Speak to Craig Simpson or Richard Coombs to discuss how we can help.

For more details on types of demerger and case studies:

Demerger to separate assets from a company before sale

Take out the parts a buyer does not want to include in a sale, tax effectively

Demerger to separate commercial trades

To add commercial focus or to create sales appeal, but minimise tax charges.

Demerger to resolve shareholder dispute

A potential solution when shareholder relationships become counterproductive. 

Demerger to protect Business Asset Disposal Relief and Business Property Relief

Protection of valuable reliefs, dependent on the favourable tax status of your company.

Demerger when outgrowing your family-owned investment company

When holding all your investments together no longer suits your family circumstances.

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