Corporate restructuring tax advice for owner-managed companies

Any reorganisation of who owns the shares or the businesses in a company or group. Common examples are putting a new parent company above an existing one, moving a trade or property into another company, merging two companies, splitting one in two, or buying back shares from a departing shareholder. Each uses different tax rules and reliefs, which is why we start with what you want to achieve and then choose the route.

Often, yes, but it depends on the conditions being met. A share-for-share exchange under section 135 of the Taxation of Chargeable Gains Act 1992 can mean shareholders make no disposal, and reconstruction reliefs can treat a business transfer as no gain, no loss. Stamp duty and SDLT have their own reliefs. None is automatic, and each has anti-avoidance rules, so we check every step before anything is signed.

Finance Act 2026 changed section 137 of the Taxation of Chargeable Gains Act 1992 so that relief can be denied where a main purpose of the arrangements is to reduce or avoid capital gains tax or corporation tax. It applies to share issues on or after 26 November 2025, with a similar rule for business transfers. HMRC guidance says a restructure with genuine commercial aims, and only a deferral of tax, is not caught.

It is not compulsory, but it is often worthwhile. Statutory clearance lets HMRC confirm in advance that a specific relief will not be denied on anti-avoidance grounds. HMRC must reply within 30 days of receiving a complete application, and we have obtained 100% of the clearances we have applied for, across 50+ applications. Whether to apply depends on the size of the tax at stake and how clear-cut the facts are.

In a share exchange, shareholders swap their shares in one company for shares in another, typically a new holding company, and the new shares are treated as the old ones for capital gains. In a reconstruction, a business is moved from one company to another, often as part of a split or merger. Different sections of the capital gains legislation apply, with different conditions and different clearances.

Possibly. Stamp duty on shares is 0.5% of the consideration, rounded up to the nearest £5, and a share exchange or a transfer of shares can trigger it. Reliefs exist for reconstructions and acquisitions, but they have conditions, including that shareholdings mirror each other and there is a genuine commercial reason. Claims need adjudication by HMRC, so the plan must allow time.

SDLT group relief can apply to transfers between companies in the same 75% group, but it can be withdrawn if the buyer leaves the group within three years, and it is unavailable where there are arrangements for that to happen. That matters if a demerger or sale is on the horizon. We look at the order and timing of property moves before any step is taken.

Simple restructures can be done within a few weeks, but those needing clearance usually take two to three months from the first call, including HMRC's 30-day window. Complex cases involving property, valuations or several shareholders take longer. We give you a realistic timetable at the outset and keep it updated, because other advisers and lenders often depend on the dates.

Sometimes. Loan agreements, leases and key contracts often include change-of-control or assignment clauses, and moving a trade to another company may need counterparties to consent. A share exchange above the existing company usually leaves contracts untouched, since the trading company stays the same. Your solicitor checks the paperwork, and we flag the likely pressure points early.

It can. When shares are exchanged for shares in a new holding company, HMRC looks back through the exchange, but you must still meet the 5% and officer-or-employee tests for the new company, and it must be a trading company or head a trading group. Where there is a risk, an election under section 169Q can treat the exchange as a disposal so relief is claimed at 18% on the gain, up to £1m of lifetime gains.

They can. The transactions in securities rules can apply where a close company's shareholders obtain an income tax advantage, for example by turning a dividend into a capital receipt. Clearance under section 701 of the Income Tax Act 2007 deals with this, and it is often included in the same application as the capital gains clearances. Where there is a real risk, we say so.

It depends on the route and the company's articles. A share exchange needs each shareholder to agree to swap their shares, unless the company's articles allow a drag-along, while a scheme or a liquidation can bind dissenting members in some cases. Persuading a reluctant minority is often as important as the tax. We help you set out the case in terms they can understand.

Partly. Unwinding often means another set of transactions with their own tax and stamp duty, and unwinding soon after can raise anti-avoidance questions. That is why we test the plan on the facts first and look at the exit routes before starting. If the restructure is designed for flexibility, you can usually adjust it later without penalty.

When the benefit is small compared to the cost, or when the structure would cause trouble elsewhere, such as restricting a lender's security or complicating a regulated business. Sometimes a simpler change, like adjusting share classes or paying dividends differently, does the job. We will tell you plainly if doing nothing is the best advice.

Closely. Many restructures are done to prepare for a sale, for example separating property from the trade or adding a holding company to receive the proceeds. Reliefs that matter on a sale, such as the substantial shareholding exemption, can require twelve months of holding, and Business Asset Disposal Relief two years of trading status. Doing the restructure early keeps those options open.

We design the tax plan, brief your solicitor on what the documents must achieve and review them for tax before anything is signed. Your solicitor drafts and files them, and your accountant deals with the accounts. This keeps legal advice with those regulated to give it, and makes sure the paperwork matches the plan.