Company Share Sales and Purchases

At Symes Bains Broomer, our expert company and commercial solicitors can advise and represent you throughout the sale or purchase of a business to ensure that your rights and interests are protected. We have local teams in Scunthorpe or Goole and work with clients across Lincolnshire and Yorkshire.

If you would like to have an initial no-obligation conversation, please call us on 01724 281 616.

Selling company shares generally involves negotiation between the buyer and seller about the terms of the business purchase agreement. Our company and commercial team can work with you to ensure that the deal you achieve is the best that it can be. The areas in which we will negotiate include the following:

• Share Purchase Agreements: The share purchase agreement will include clauses to protect the buyer from existing liabilities as far as possible. It is important that these provisions are carefully drafted to ensure that they are legally enforceable. For example, if a restriction is too wide, then a court could potentially decide that it is unreasonable and not valid.
• Due Diligence on Share Purchases: The buyer will want to carry out extensive investigations into the state of the business and its financial, tax, and legal affairs before agreeing on the details of the purchase. If you are selling a company, you will need to go through all of their enquiries and provide accurate replies along with copies of relevant documentation, such as accounts and contracts.
• Guarantees and Indemnities for Share Sales: Guarantees or warranties are statements by the seller in respect of the state of the company that the buyer is entitled to rely on. This is confirmation that the information provided is accurate in respect of issues such as company accounts, employment records, tax information, ownership of land, buildings and other assets, to include intellectual property and ongoing legal disputes.
• Restrictive Covenants: On a business sale, the seller will be bound by the restrictive covenants contained in the share purchase agreement. These are clauses preventing certain activities from being carried out that could be damaging to the company, such as setting up in competition or soliciting clients or customers.

How Much Tax Do You Pay on Share Sales?
If you make a gain when you sell shares, you will be required to pay Capital Gains Tax (CGT) on the gain. This is payable at the rate of 10% or 20%, depending on your tax band. In some instances, you may qualify for Business Asset Disposal Relief, formerly known as Entrepreneurs’ Relief, which means that the Capital Gains Tax rate will be 10%.

What is a Stock Transfer Form?
To formally complete a company purchase, a stock transfer form must be completed and registered with HM Revenue & Customs. Ad Valorem Stamp Duty must be paid by the purchaser at the rate of 0.5 per cent of the amount paid for the shares.

What is a Share Transfer Agreement?
Share transfer agreement is another phrase for a share purchase agreement.

We offer a range of flexible pricing options to suit your business’s needs and budget, including fixed fee arrangements where appropriate.

Our company and commercial solicitors will be happy to provide a realistic estimate of costs at the outset and will always keep you up to date about the cost of any ongoing legal work we carry out for you.

For more information about our fees and pricing, please get in touch or visit our pricing page.