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The Tax Schedule: A Guide to Tax Warranties and Indemnities 4th ed


ISBN13: 9781913507299
Previous Edition ISBN: 9781910151280
Published: October 2023
Publisher: Spiramus Press Ltd
Country of Publication: UK
Format: Hardback & CD-ROM
Price: £100.00
Paperback edition not yet published, ISBN13 9781913507626



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The Tax Schedule explains the underlying rationale of the key provisions of the tax schedule, and provides updated model long-form and short-form warranties and tax indemnities.

The purpose of the book is to explain and simplify issues for tax advisors involved in transactions of buying and selling companies and business, enabling negotiations between tax advisors to keep sight of the commercial reality of the transaction (a sale by a willing seller to a willing buyer). The purpose of the tax schedule is to determine where responsibilities and risks will lie following the completion of the transaction, as well as to re-examine a number of so-called ‘market practices’.

The intended readership of the book is tax lawyers, tax accountants, corporate lawyers, corporate advisors and finance directors who are involved in the process of the sale of a company.

Subjects:
Taxation
Contents:
Preface to the fourth edition
Preface to the first edition
Acknowledgements
Online resources
Table of authorities
Glossary
1. THE TRANSACTIONAL PROCESS
1.1 Background issues
1.2 Pre-completion clearances
1.3 Post-completion clearances
1.4 Transactions and clearances with EU dimension
1.5 Employee share scheme matters
1.6 Buyer’s issues
1.7 Seller’s issues
1.8 Negotiating the tax schedule
1.9 Completion issues
1.10 Post-completion matters
2. DUE DILIGENCE
2.1 Overview
2.2 The buyer’s tax due diligence report
2.3 The seller’s tax due diligence report
2.4 The disclosure process
2.5 Measuring the risk
2.6 Due diligence in the purchase of a business
2.7 Tax due diligence in the purchase of a company
3. WARRANTIES
3.1 Overview
3.2 Warranties in due diligence
3.3 Disclosures against tax warranties62F
3.4 Accounts, tax computations and payments
3.5 Administration and tax compliance
3.6 Advance corporation tax (ACT)
3.7 Anti-avoidance
3.8 Associated companies
3.9 Capital allowances
3.10 Chargeable gains
3.11 Clearances
3.12 Close companies
3.13 The construction industry scheme (CIS)
3.14 Controlled foreign companies (CFC)
3.15 Corporation tax
3.16 Deferred tax
3.17 Demergers and exempt distributions
3.18 Disclosure of tax avoidance schemes (DOTAS)106F
3.19 Distributions and dividends
3.20 Dormant companies
3.21 Employment-related tax issues
3.22 Group issues
3.23 Inheritance tax
3.24 Insolvency issues
3.25 Intellectual property
3.26 Land and property issues
3.27 Loan relationships
3.28 National insurance contributions (NICs)
3.29 PAYE
3.30 Penalties regime
3.31 Research and development (R&D)
3.32 Residency issues
3.33 Secondary tax liabilities
3.34 Self-assessment
3.35 Stamp taxes
3.36 Transfer pricing and non-arm’s length transactions
3.37 Value added tax and Customs & Excise
3.38 Value shifting205F and depreciatory transactions206F
4. SALE AND PURCHASE OF A COMPANY
4.1 Background issues
4.2 Issues for the buyer
4.3 Taxation issues for the seller
4.4 Dealing with target’s pre-completion debts
4.5 Accounts and completion accounts
4.6 Structuring the consideration
5. SALE AND PURCHASE OF A BUSINESS
5.1 General overview
5.2 Commercial considerations
5.3 Due diligence
5.4 Tax issues
5.5 VAT and transfers as a going concern (TOGC)
6. SPECIAL SITUATIONS
6.1 Insolvencies and administrations
6.2 The locked box mechanism
6.3 Public listings and offerings
6.4 Partnerships
7. SHARE SCHEME ISSUES
7.1 Overview
7.2 Corporation tax relief – an important negotiating issue
7.3 Tax issues arising in respect of share incentive schemes
7.4 Roll-over options
7.5 Takeover code issues
7.6 Administrative and reporting requirements for HMRC-approved schemes
7.7 Partly paid shares
7.8 Disguised remuneration rules
7.9 Employee shareholders and ESS
8. VENTURE CAPITAL SCHEMES
8.1 The Enterprise investment scheme
8.2 Seed enterprise investment scheme
8.3 Venture capital trusts
8.4 Social investment tax relief
8.5 Corporate venturing scheme (CVS)
9. GROUP ISSUES
9.1 Chargeable gains groups
9.2 Corporation tax groups
9.3 Group payment arrangements
9.4 Intangible assets
9.5 Loan relationships
9.6 Stamp duty
9.7 Stamp duty land tax (SDLT)
9.8 Substantial shareholdings
9.9 VAT groups
10. THE TAX SCHEDULE IN THE SALE AND PURCHASE OF A COMPANY
10.1 Background issues
10.2 Drafting principles
10.3 Short form or long form tax schedule?
10.4 Tax liabilities
10.5 An accounts deal
10.6 A completion accounts deal
10.7 The seller’s indemnity
10.8 Limitations
10.9 De minimis and maximum caps
10.10 Third party recovery
10.11 Overprovisions
10.12 Reliefs and savings
10.13 Mitigation and/or shared pre-completion tax reliefs
10.14 Buyer’s indemnity
10.15 Conduct provisions
10.16 Gross-up and withholdings
10.17 Zim Properties
APPENDIX 1. LONG FORM TAX SCHEDULE
APPENDIX 2. SHORT FORM TAX SCHEDULE
APPENDIX 3. LONG FORM TAX WARRANTIES FOR THE SALE OF A COMPANY
APPENDIX 4. TAX WARRANTIES FOR THE SALE OF A BUSINESS
APPENDIX 5. HMRC INFORMATION & INSPECTION POWERS
APPENDIX 6. TIME LIMITS FOR ASSESSMENTS & CLAIMS AND RELATED MATTERS
APPENDIX 7. HMRC CLEARANCES
APPENDIX 8. OVERVIEW OF HMRC APPROVED EMPLOYEE INCENTIVE SCHEMES
8.1. Approved Share Incentive Plans (“SIPs“)
8.2. Schedule 4 Company Share Option Plans (“CSOPs”)
8.3. Enterprise Management Incentives (EMIs)
8.4. Schedule 3 SAYE Option Schemes
APPENDIX 9. EIS OVERVIEW CHECKLIST
APPENDIX 10. SEIS OVERVIEW CHECKLIST
APPENDIX 11. VCT CHECKLIST
APPENDIX 12. PENALTIES AND ERRORS
APPENDIX 13. DOTAS LEGISLATION
APPENDIX 14. COMPANIES ACT 2006 –
PART 28, CHAPTER 3
APPENDIX 15. THE TAKEOVER CODE RULE 15
INDEX