Hi
Have a question as follows:
2 x 15% shareholders acquired the rest of a business for £450,000
Business later sold for £450,000
Legal costs borne by sellers - £110,000
Earn out on top potentially £500,000 following 3 year profit period
Tax return due for CGT
Am I correct in thinking the calc is
Purchase - £450k
Sale - £450k
Legals - £ 110k
Loss - £-110k
Earn out - £500k
Is the CGT payable on the £500k earn out minus the £110k loss? Or is the earn out kept separate?
All figures are collective and I have not split out the 50% share for each of the individuals.
Many thanks for any help given
Andy
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