Budget 2026: what it means for you and your business —

Business Restructuring & Reorganisation

In short

Companies restructure to prepare for sale, to separate trading from property assets, to bring in or buy out shareholders, to improve tax efficiency, or to respond to financial pressure. We advise on group reorganisations, share buy-backs, demergers and solvent reconstructions — managing the tax and Companies Act consequences so the benefit is realised without triggering unexpected charges.

Restructuring is one of the few areas where the tax consequences of getting it wrong can exceed the entire benefit of doing it at all. Moving assets between companies, buying out a shareholder, splitting a business in two — each is a disposal unless it is structured to fall within a relief, and each relief has conditions. This is not a DIY area.

Why would I restructure my business?

To prepare for a sale. A buyer usually wants the trade, not the property — and often not the whole group. Separating them beforehand can transform both the price and the tax outcome.

To protect assets. Holding valuable property inside a trading company exposes it to the trade’s risks. A holding-company structure ring-fences it.

To buy out a shareholder — via a share buy-back or a demerger where partners want to go separate ways.

To improve tax efficiency — including group relief, and the associated-companies position that divides your corporation tax thresholds.

To split a business where two divisions, or two families, should go their own way.

How do I separate property from my trading company?

A very common objective, and a genuinely dangerous one to attempt without advice.

Simply transferring the property out is a disposal at market value — potentially triggering corporation tax on the chargeable gain, SDLT on the way into the new entity, and a taxable distribution to the shareholders. The tax cost can exceed the value of the protection you were seeking.

Done properly — usually through a group structure with the appropriate reliefs, or a statutory demerger — it can often be achieved without an immediate tax charge. The route depends entirely on the facts, and HMRC clearance should generally be obtained before anything moves.

What is a company share buy-back?

A company purchases its own shares from a departing shareholder, using its own cash rather than requiring the remaining shareholders to fund the purchase personally.

It is a very useful tool — but it is heavily conditioned. There are Companies Act requirements (distributable reserves, correct procedure) and tax conditions that determine whether the seller receives capital treatment (usually the aim) or is taxed as though they had received a distribution (usually far worse for them).

HMRC clearance can and should be sought in advance. Getting the procedure wrong can render the buy-back void.

What about a business in financial difficulty?

If the business is under pressure but fundamentally viable, restructuring may involve renegotiating debt, disposing of loss-making divisions, or a solvent reorganisation.

Be clear about one thing: if the company may be insolvent, directors’ duties shift — you must begin acting in the interests of creditors rather than shareholders, and continuing to trade can expose you personally to wrongful trading liability. Take advice early. The options available to a business with three months of runway are vastly better than those available to one with three weeks.

Get HMRC clearance before anything moves

Most reorganisation reliefs depend on conditions of fact and purpose, and HMRC offers advance clearance for many of them. Obtaining clearance before implementing is the difference between certainty and a very expensive argument two years later.

On this page

Why LMJ Group

Tax-led design — the relief conditions determine the structure, not the other way round.

HMRC clearances obtained before anything is implemented.

Companies Act procedure done properly — a botched buy-back can be void.

We work with your solicitor, not around them.

We’ll tell you if the tax cost exceeds the benefit — sometimes it does.

Related services

Frequently asked questions

How do I get the property out of my trading company?

Carefully, and not by simply transferring it. A straight transfer is a disposal at market value — potentially triggering corporation tax on the gain, SDLT on the way in, and a taxable distribution to shareholders. Done properly, usually via a group structure or statutory demerger, it can often be achieved without an immediate charge. Get advice and HMRC clearance first.

Can my company buy back shares from a departing shareholder?

Yes, and it's a useful tool — the company funds the exit rather than the remaining shareholders paying personally. But it's heavily conditioned: there are Companies Act requirements on distributable reserves and procedure, and tax conditions determining whether the seller gets capital treatment or is taxed on a distribution. Seek HMRC clearance in advance.

Will restructuring trigger a tax charge?

It can — and the charge can exceed the benefit if it's done without advice. Most reorganisations are disposals unless they fall within a specific relief, and each relief has conditions. Designed properly, with HMRC clearance obtained beforehand, most restructures can be achieved without an immediate charge.

My business is struggling — what are my options?

That depends heavily on how much runway you have, which is why early advice matters so much. If the company may be insolvent, your duties as a director shift to creditors, and continuing to trade can expose you personally. A business with three months of runway has far better options than one with three weeks.

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This page provides general information about the 2026/27 UK tax year and is not advice on your particular circumstances. Tax and regulatory rules change frequently. Please contact us before acting, or refraining from acting, on anything set out here. LMJ Group is a firm of Chartered Accountants regulated by the ICAEW. LMJ Group is not a registered auditor and does not provide audit services. Last reviewed: July 2026.