|Chris Wookey CTA|
Preparing a company for the exit of the current owners or a winding-down presents a unique set of challenges.
Transferring the company or its
business assets to new ownership often means that financial relationships need
to be unwound or cleared at either or both the company and shareholder level.
accounts to decisions on liquidation versus capital reduction or share buy backs,
there are also complexities with ss 45A, 45B, and 177EA. In addition, advisers need to
ensure they've considered the debt equity rules, pre and post CGT
shareholdings and how any value will be extracted using the small business CGT
of Deloitte Private in Melbourne. At the 2017
WA Tax Intensive in November this year he presented ‘Transitioning a company for wind-down or exit’,
a two-part session covering the key tax issues arising when a company is
wound down or when certain shareholders want to exit.
We spoke with Chris about some of
the key issues facing advisers in this situation and what to expect from his
chartered accountant, more than once I’ve been accused of thinking more like a
lawyer!" Chris said.
"That might explain why I like figuring out how new provisions work and
contributing to their development through my involvement with The Tax
Institute’s Technical Resource Committee. For many years I have worked in the
private client space and enjoy being able to meet the people my work benefits.
“At the Intensive, I’ll be looking at preparing a company for wind down or
exit, covering such things as cleaning up the balance sheet and working through
various ways to liberate the value accumulated in the corporate entity. There
is a veritable minefield of anti-avoidance provisions that potentially apply
that advisers need to be aware of, and I’ll look at how these can be worked
up the balance sheet and will cover the decisions around what works best for the
company and for shareholders – a liquidation, cancellation, buy back or capital
Looking at making tax-effective distributions of profits and assets,
Chris will also detail how the small business CGT concessions can be accessed.
that uses a number of examples to deep-dive into some of the topics he will have covered. The case scenarios will address situations found in practice in
relation to privately held companies, including extracting amounts sheltered by
the small business CGT concessions, attempts to divert taxable income, assigning
loans within the family, calling on credit loans, and dividends as part of the
sale or arrangement.
said: “On the technical front, there are things such as taxable loan repayments,
deemed capital gains and being prevented access to franking credits. On the
practical side, we usually need to watch out for complicated family
relationships and the need to anticipate what the needs of the next set of
shareholders will be.”
attendees will walk away from my session with some tools they might be able to
apply in their own client situations.”
work, where he says: “I like to do practical things with a physical result – like
making things out of wood or working in the garden – that you can stand back
from when they are finished and say, with satisfaction, “I did that!” I also
enjoy mountain bike and road cycling and, in times past, hot air ballooning.”
Legal), who presented the session on ‘Succession planning for family trusts’ and Linda Tapiolas CTA (Cooper Grace Ward
Lawyers), who looked at ‘Dealing with difficult structures’. Grahame Young FTI (Francis Burt Chambers) opened the day with
his session on ‘Reflections from decades of practice’.
the Perth Convention and Exhibition Centre.
You can find out more about Chris Wookey’s
session, and the rest of the program, on our website.