Monthly Archives: September 2021

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Raising finance to buy out a director

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By Toby Cotton on Small Business – Advice and Ideas for UK Small Businesses and SMEs
There may be instances where a shareholder might want to exit the company. This could be due to losing interest or retiring and would need the other shareholder to buy out their shares and take full control.
The first consideration if you want to buy out a fellow shareholder is to check the articles of association and shareholder agreement to make sure that both parties understand the process and any pre-existing terms for such shareholder exits or prohibitive clauses for share buybacks. You would need to place a reasonable value on the departing shareholder’s shares, and it is often advisable to ask your accountant to provide an independent valuation.
For ease in this article, we will use a simple trading company with 50:50 shares between two shareholders. The 50 shares are valued at £500,000 so the total value of the company is £1m.
>See also: Paying dividends to directors
There are a number of options available, each with different implications and tax consequences:
Company buyback of shares
In this case the company would pay the departing shareholder £500,000 to buy back their 50 shares, which would leave the remaining shareholder with

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What the Equality Act means for employers

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By Katie Maguire on Small Business – Advice and Ideas for UK Small Businesses and SMEs
What does the Equality Act mean for employers?
The Equality Act 2010 was and still is one of the most important pieces of legislation for employers and employees. It is concerned with discrimination and harassment in respect of nine protected characteristics, namely: age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation.
Before the Equality Act came into force discrimination law was contained in different pieces of legislation.
The Equality Act gives protection against work-related discrimination, making it unlawful for an employer to discriminate against its job applicants, employees and former employees. If it does so, it will be liable for its actions. In addition, employers may also be held liable for the wrongful actions of their employees or agents. This is because under the Equality Act, anything done by an employee in the course of their employment is deemed to be an act done by the employer. This is called vicarious liability. The only defence available to this for an employer is if it can show that it took all reasonable steps to prevent the employee from doing

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New small business strategic challenge or the same one in disguise?

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By Matthew Cushen on Small Business – Advice and Ideas for UK Small Businesses and SMEs
It’s a long while since I was defined by a sector. These days I invest in businesses across all sectors. The only commonality being a compelling new insight, room in a market for a new proposition to grow (because the market is highly fragmented and/or high growth) and the potential to build a loved brand – which is as likely to be B2B as consumer.
But a long time ago I was defined as a retailer. Inevitable given a childhood growing up in a Post Office in sleepy Devon and skiving off school to man the shop when Mum & Dad had a rare holiday. From there I helped set up the first overseas Virgin Megastore (yes Virgin used to sell records – and cassette tapes!). Then looked after a big chunk of Woolworths, redesigned the John Lewis supply chain and helped set up a huge retail business in India – in one year we built 800 supermarkets and 50 hypermarkets. So reminiscing finds two retailers that no longer exist, one in the department store space that is having an existential crisis and one that is

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