Any way around double tax hit on disposing of company owned property?

[Corkie]

I am involved in a company that owns a building...nothing else just a building.
We are in the process of disposing of same. However, we would prefer to dispose of the Company owning the Building (1 layer of CGT). The punters seem more keen to buy the Building itself (even though they would pay higher stamp duty 9% versus 1%).

My question is, has anyone out there come accross any scheme to avoid a double hit on tax if a company sells it's only asset i.e. how can it get the proceeds of the sale out to the shareholders?

The company has > 10 shareholders holding from circa 20% to quite small % holdings.

 

[dam099]

Re: Any way around double tax hit

The punters seem more keen to buy the Building itself (even though they would pay higher stamp duty 9% versus 1%).

My question is, has anyone out there come accross any scheme to avoid a double hit on tax if a company sells it's only asset i.e. how can it get the proceeds of the sale out to the shareholders?

They might save stamp duty by buying the company but they would be taking on your double CGT hit (albeit deferred until they go to sell). To avoid a double hit when they sell the building they will also have to sell the company on to somebody else something you are experiencing is not always the easiest thing to do.

 

[Brendan Burgess]

Re: Any way around double tax hit

I don't think that there is anything you can do. There was a very complex legal tax avoidance scheme which was closed off about two years ago. This did involve very high legal costs though.

Brendan

 

[millertime]

There is a double tax hit here regardless of what you do. The best way to proceed is to liquidate the company. The company will be hit with CGT on the disposal of the building & the shareholders will have CGT on the disposal of their shares in the company. You could however reduce the overall tax by getting a friendly valuer who would value the building on the conservative side.