Tag Archives: purchase of own shares

Purchase of own shares: What could possibly go wrong?

A company purchase of own shares (CPOS) is often a tax-efficient way for an individual shareholder to dispose of their shares (e.g., on retirement). However, unexpected tax consequences can arise if a CPOS is not handled correctly. Income treatment As a general rule, when the company buys back its own shares from the shareholder, any… Read More »

Purchase of own shares: Worth the bother?

For individual shareholders of family or owner-managed trading companies, a company purchase of own shares (CPOS) can be a useful ‘exit’ strategy in the right circumstances, subject to certain company law requirements being satisfied. Income or capital? When the company buys back its own shares from the shareholder, any ‘premium’ (i.e., payment exceeding the capital… Read More »