Tavistock Group  

Tavistock escapes £7m tax charge on wealth business sale

Tavistock escapes £7m tax charge on wealth business sale

Tavistock Investments has escaped paying £7m in tax on the sale of Tavistock Wealth.

In a statement to the stock exchange this morning (October 7), the firm said the recent disposal of Tavistock Wealth to Titan Wealth had qualified for substantial shareholding exemption (SSE). 

The SSE consists of four exemptions, which mean the transaction is not subject to UK corporation tax.

Tavistock said as a consequence, no tax charge will be incurred on the £40m it received in cash for the shares. Had it not been for SSE, the transaction might have incurred a tax charge of approximately £7m.

The deal was made alongside a 10-year strategic partnership between Tavistock Investments and Titan Wealth which will see Tavistock act as Titan’s retail distribution partner

The statement added as a result of the completion of the transaction, as well as a recent buy-back and cancellation of 4.75 per cent of the firm’s issued shares, the firm’s net asset value per share rose from 2.59p to 8.5p between the end of March and the end of August.

Tavistock Wealth was renamed Titan Asset Management as the £40m sale completed at the end of August last year. 

In September, Tavistock posted an operating profit of £1.23m for the year to March 2021, after it brought forward a "long-planned" group reorganisation project thanks to a £2.13m coronavirus loan.

The business said it had undergone a £1.2m reorganisation which was anticipated to reduce its overhead costs by £750,000 a year.

sally.hickey@ft.com