What has to happen two years before a business sale, and the signs in a client’s file that a sale is coming.
An owner may tell their accountant about a sale only when there is a buyer. By then the deal runs on the buyer’s timetable, due diligence is under way, and the things that take a year or two can no longer be done.
The useful work happens earlier, while the position can still be changed. The signs are in the accounts, so the accountant can see them before a buyer appears.
An illustration, with a made-up company. An approach arrives in the spring. The client mentions it to their accountant in the summer, by which time heads of terms are agreed. Due diligence runs through the autumn and completion is targeted for the year end.
By then the relief conditions are fixed, the trading-status question is on the buyer’s list, and the last window for an employer pension contribution closes with the company’s year end.
Raise it while a sale is still hypothetical, when the options are still open.
Four questions about the client’s own position have to be worked out alongside the tax.
The proceeds may have to fund thirty or more years, including a period of care. In England a person with capital over £23,250 gets no local authority help with the cost of care (Department of Health and Social Care, upper capital limit for 2026/27). The sale price needs to be tested against the income the client will need.
The plan for the money depends on what the client intends to do after the sale.
Working for the buyer for two years changes the client’s tax position and income, and needs planning.
A sale turns shares that may have qualified for business property relief into cash, which does not qualify. Inheritance tax is charged at 40% above the nil-rate band of £325,000 and the residence nil-rate band of £175,000, both frozen to 5 April 2031 (Budget 2025, Overview of tax legislation and rates, gov.uk).
Wording you can use“You have mentioned that you would like to be out in a few years. Some of the planning around a sale has to happen two or three years before it. Would you like an hour with the financial adviser we work with now?”
You are describing a timetable, which is a fact about the rules. Advising on the structure of the sale, or on what the client should do with the proceeds, is regulated advice.
The corporation tax work, the accounts and the transaction advice stay with your firm. The Equity & General financial adviser covers the personal side, meaning what the proceeds have to deliver, how the pension fits, and the client’s plans after the sale. The introduction is tracked in your portal from the first call to the advice being in place.
Timing and rules are facts your firm can explain. What the client should do with the proceeds, how they should be invested, what a pension contribution should be, and which deal structure suits them are all regulated advice.
Equity & General is authorised and regulated by the Financial Conduct Authority. There is no charge to your firm, and we do everything to set it up for you.