Con sider the tax implications
Often when selling their businesses, owners will make the mistake of not thinking about how it will affect their next tax return. In particular, it is far more beneficial from a tax point of view to sell an entire company than to just sell its assets.
“For an acquirer, particularly if they are borrowing money, it is far more effective to set up a new company and put the assets and debt into that entity,” Grantham says. “But there is a big difference in the tax implications for the seller between an asset sale and company sale.”
Advisory partner at Citadel Christelle Louw says it is also vital to consider the structure of the owner’s investment in the company because capital gains will be taxed differently depending on whether it is held personally, in a holding company