Buying Shares In Own Business

[businessmind]

I am a shareholder in my own business along with three other individuals. We each own a 25% share and are employed by the business. One of the shareholders wished to terminate their employment and sell their shares, which will be bought equally by the remaining shareholder.

The shares were originally bought for a nominal sum but we estimate that we will each have to pay £10,000 for the proportion we are buying. Could anyone provide outline advise on whether any tax relief is available (I am aware that the Enterprise Investment Scheme is not relevant in this case)?

[pawncob]

There is no tax relief as such on this investment, but if you borrow the money, interest paid is allowable.

[Tax Champion]

Under certain circumstances the company can buy the shares back. Worth checking with your accountant.