Robert Langston
Robert is the Consultant Editor for the International Tax and Transfer pricing topic of the corporate tax module. Robert is a Chartered Tax Adviser and tax partner at Saffery Champness. He has specialised in international tax for eight years, providing UK and cross-border tax advice to larger private and smaller listed companies.
Practice Area
Panel
- Contributing Author
Membership
- Chartered Institute of Taxation (CTA)
Qualification
- Listed in Tax Journal's 40 Under 40 tax advisers in 2012
1 Contributions by Robert Langston
PRACTICE NOTES
UK corporate demergers: statutory, capital reduction and liquidation routes, pre‑demerger restructuring and HMRC clearances: key tax reliefs, risks and stamp taxes
A demerger is the division of a company’s business into two or more segments, usually continued by successor entities that remain under the original ownership.
Typical commercial reasons include:
splitting a business ahead of a sale or other deal
bringing in different shareholders (or option holders) to one venture but not another
separating activities with differing risk, regulatory or commercial profiles
resolving a shareholder dispute
releasing value from an underlying business
carving out a non-core activity as the group matures, or
using a demerger as an alternative to a sale
There may also be tax advantages, for example:
investment businesses can be split from trading businesses so trading businesses can qualify for:
business asset disposal relief (formerly entrepreneurs' relief)
the substantial shareholdings exemption, or
inheritance tax business property relief, see Practice Note: IHT—business property relief
, and
the proceeds of any sale of a demerged business are realised directly by shareholders, so any gain may qualify for business asset disposal relief
However, if tax is the sole reason for a demerger, the various commercial purpose tests are...
Tax
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