All business owners will inevitably have to either sell or exit their business at some future point.
This is a fact of business life for some this may be a planned exit for others something that comes out of the blue.
There are many ways exiting may take shape.
It may be that you hand onto a member of your family or to a trusted manager or you may seek to sell in the open market or to a competitor.
Whatever your position there are several important factors to consider.
For example, there is the classic starting point that thinking about and planning your likely pathway towards an exit, however far in the future this might be, is a fundamentally sound business principle, which has a nice circular position attached to it.
If you plan your exit this is likely to involve looking at ways of extracting the maximum future value.
To make your business more valuable you may well identify key steps you need to take today or in the near future which support this. Those key steps may help make the business more profitable today because the more profitable your business is the more valuable it will become in the longer term.
The process of planning an exit can help in the near future with achieving greater profits. In terms of the exit itsel,f planning ahead also helps create structures within your business, which could be important to saving tax in the longer term.
There are certain tax reliefs available such as the business asset disposal relief, but these are not always straightforward and it may be that with forward planning they can be maximized more efficiently.
Likewise for most businesses the structures of the business;
can all impact on taxes paid. This applies both to the duration of the business owners time in the business and at the point of departure.
There are various factors at play here, which you need to be dealing with. These include a mix of tax considerations both now and longer-term. How to technically structure your business and the way everyone is paid, as well as the basic principle of working out how to make your business the most successful version it can be in terms of its;
– presence in the market
– legal matters
Planning to exit your business is therefore far from a one-dimensional exercise. Plus it needs preparation over the course of time.
Financial advice, expertise and support plays a major role in identifying the best pathway which will always be based on your personal and business circumstances and requirements.
We are here to help you with all aspects of planning a business succession.