This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our privacy notice.

Business contracts and agreements: Think them through!

Shared from Tax Insider: Business contracts and agreements: Think them through!
By Mark McLaughlin, April 2024

Mark McLaughlin highlights the importance of ensuring that business contracts and agreements are drafted carefully to avoid unexpected and expensive tax consequences.  

Contracts and agreements sometimes state one thing but mean another. When a taxpayer asks HM Revenue and Customs (HMRC) to treat an event or transaction as the parties intended, as opposed to in an unintentional way based on an inaccurately or imprecisely drafted contract or agreement, HMRC’s response is invariably that the tax treatment must follow the terms of the contract or agreement, even when the tax consequences are unexpected and more costly to the taxpayer. 

Business sale agreements 

Thus, on (say) a company sale, the share sale and purchase agreement (SPA) should be drafted carefully to reflect the intended rights and obligations of the parties under the agreement and prevent unforeseen and unexpected

This is one of our 2553 Premium articles

To see this article in full and unlock access to our complete library of 2553 articles click 'subscribe & unlock' below:

Subscriptions include a 14 day free trial
+ money back satisfaction guarantee