Sometimes, people who are in business together reach the point where they’d like to separate their interests – or in other words, demerge.

They might for example, have contrasting views on the business’s future direction or they might simply want to unlock shareholder value, improve efficiency, focus on core activities or reduce debt.

Demergers can also come into play when restructuring companies with investment properties. A capital reduction demerger, for instance, might be the solution when a buyer wants to sell a business unencumbered by a property investment portfolio. Such demergers are complex and its imperative you seek professional tax advice to avoid exposure to taxation charges and legal fees.

Undertaking a demerger might sound daunting and complicated – especially from a tax perspective – but it needn’t be. At Jerroms Miller Specialist Tax, we have extensive experience of dividing companies and groups into two or more parts, taking advantage of all the relevant tax reliefs and obtaining clearance in advance from HMRC.