Principle

The French tax administration always monitors stock transfers very closely, especially when concerned companies belong to the same group without belonging to the same tax integration perimeter.

Company stock transfers are affecting the seller in terms of taxation as the transfer price will determine the amount of capital gain subjected to tax.

Likewise, stock transfers can also affect the purchaser in terms of tax if the purchasing price seems too low (risk of fiscal reassessment) or too high (risk of fiscal requalification and contestation of the deductibility of financial expenses on the debt of purchase).

Our mission consists in providing company management with competences in business and company valuation as well as our knowledge of method analysis used by the Tax administration.

Applicability

 Setting up of the acquisition or handover brief,
 Assistance in case of tax litigation.

Méthode

The methods we use are similar to the ones presented on the Company Valuation page. According to context, we may apply:

• intrinsic valuation methods such as net asset value, discounted cash flow or adjusted net present value methods,

• Analogical methods (such as Stock Exchange comparative analysis or reference to similar types of transaction).

We are also using methods of experts presented by the Tax administration in its guidebook on company valuation, chiefly productivity and yield-return methods.

However, the value we give is not only estimated financial data but also a modelling of long term growth perspectives of the company to be valued.

Results

 Drawing up of a documented report for the purchaser/seller,
 Assistance in case of litigation.

We helped them :

 Laboratoires Fournier, Monceau Fleurs…