Would welcome opinion on this.
My husband was self employed for the last 12 years. Earlier this year, he had an accident which has caused serious damage to his spinal chord. He was in hospital for 4 months and even though at home now, is quite limited in what he can do for himself. It is unlikely he will make a full recovery.
As a result of the accident he decided to sell his business. While the business could run without his "hands on" input for some time, he believes it is best to sell now, and eliminate as much stress from his life as possible. He will get a decent price for the business.
I know there is a provision in Income Tax whereby an employer can make a tax free lump sum payment to an employee, where the employee has to terminate employment becasue of an injury.
Does anyone know if this also applies to a self employed business person - where in effect he is making a payment to himself. The business was set up as a company.
And if this has been tested with the Revenue, is there a limit on the sum that can be paid tax free? Would it be a multiple of annual salary?
We are obviosuly looking at reducing our CGT liability here, but don't want to run the risk of saving on CGT, and then to be hit at a later date with a more expensive Income tax bill.
Would appreciate if anyone has experience or advice on this.
Not sure if it is relevant, but compensation will not be paid as a result of the accident. Happened as a result of an epileptic seizure that ended with a very bad fall.
Many thanks
Valc
My husband was self employed for the last 12 years. Earlier this year, he had an accident which has caused serious damage to his spinal chord. He was in hospital for 4 months and even though at home now, is quite limited in what he can do for himself. It is unlikely he will make a full recovery.
As a result of the accident he decided to sell his business. While the business could run without his "hands on" input for some time, he believes it is best to sell now, and eliminate as much stress from his life as possible. He will get a decent price for the business.
I know there is a provision in Income Tax whereby an employer can make a tax free lump sum payment to an employee, where the employee has to terminate employment becasue of an injury.
Does anyone know if this also applies to a self employed business person - where in effect he is making a payment to himself. The business was set up as a company.
And if this has been tested with the Revenue, is there a limit on the sum that can be paid tax free? Would it be a multiple of annual salary?
We are obviosuly looking at reducing our CGT liability here, but don't want to run the risk of saving on CGT, and then to be hit at a later date with a more expensive Income tax bill.
Would appreciate if anyone has experience or advice on this.
Not sure if it is relevant, but compensation will not be paid as a result of the accident. Happened as a result of an epileptic seizure that ended with a very bad fall.
Many thanks
Valc