Owner Managed Businesses

by Andy Rainford
access120 days access
cpd hours4 CPD hours
price£75+vat

This course will enable you to:

  • Get to grips with the basics of owner managed businesses (OMBs)
  • Handle issues related to business growth such as capital expenditure and VAT registration
  • Advise on when and how incorporation becomes a sensible option
  • Ensure your clients generate profit in a tax efficient way
  • Offer support on whether to sell a business or pass it on to the "next generation"

There has been a significant increase in the set-up of owner managed businesses (OMBs) in recent years. Whether they are sole traders, limited companies, or partnerships the rules around set up, management and ultimately disposal of OMBs are wide ranging and complex. It is our job, as accountants, to support clients through the complexity and to ultimate success in their chosen business.

This course provides an overview of owner managed businesses. It guides you through various tax, incorporation and income issues encountered at different stages of a business's life - from set up to disposal. The course also helps you advise on decisions such as when incorporation is a suitable option or, whether selling or passing it on to the next generation is best for your client's situation.

Overview

  • What is an OMb?
  • Creating an OMB
  • Trade vs business

The early years

  • HMRC registration
  • Tax years
  • Working out the profits
  • Business expenditure
  • Pre-trading expenses
  • Working from home
  • What is taxed when?
  • Overlap profits
  • Reporting
  • Loss reliefs

Growth

  • Capital expenditure
  • Annual investment allowance
  • Working out AIA
  • The VAT system
  • VAT sales and invoices
  • VAT returns and penalties

Incorporation

  • Corporation tax
  • The incorporation process
  • Option 1: Incorporation relief route
  • Option 2: Holdover relief route
  • Restrictions
  • Incorporation with s.165
  • Option 3: Sale to the company

Profit extraction

  • Salary v dividends
  • Directors' loan accounts
  • A second director-shareholder

Selling the business

  • Selling the company business
  • The base cost
  • Personally owned assets
  • What if the proceeds aren't wholly upfront cash?
  • Potential tax savings

Passing the business on

  • The business as a legacy
  • CGT
  • Inheritance tax
  • IHT and lifetime transfers
  • Business property relief
  • Qualifying for BPR
  • Death tax on lifetime transfers
  • Problems with loans
  • Planning opportunities
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