This thesis will deal with generational succession of family-owned companies. When transferring the company within the family, there are some opportunities, but also demands from the tax authority, which need to be considered before generational succession is made. The thesis aims to identify, analysisand conclude based on the tax issues that arise in this situation, including gift tax and tax on equity income. The generational succession can be a complex process that requires both time and planning in order to meet the parties' wishes and needs –e.g. capital need, financing need, minimizingtax payment, cashflow in the company and the time perspective. A planning of generational succession can in many cases either postpone or reduce the tax payments. The thesis will describe the different ways in which the succession can take place, as well as restructuring of the company that can be carried out before the transfer, in order to facilitate the succession. The thesis will also describe how unlisted securities are valued when the trade is between dependent parties, including calculation of value of goodwill. The theory is analyzedthrough a case study of the company Andersens Møbler A/S, where the owner wants to hand over the company to his daughter. The relevant theory will be analyzed in order to arrive at the most optimal setup in this situation. The main conclusion of the thesis is, that this family must apply the A/B model, since this model to the greatest extent accommodates all parties, in particular minimizingthe tax payment for both acquirer and assignor.
|Educations||MSc in Auditing, (Graduate Programme) Final Thesis|
|Number of pages||83|