Tax Due Diligence

Tax due diligence is a critical step in any business sale, buy-out or M&A transaction. 

Carrying out tax due diligence could help you uncover hidden tax risks which, if left undiscovered, could prove expensive.

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In carrying out both financial and tax due diligence the RPGCC Tax and Corporate Finance teams work together to highlight and identify any potential tax risks early in the sales process.  This could help you negotiate better terms and help in the early days post-transaction.


What is tax due diligence and how can RPGCC help? 

Tax due diligence involves examining the tax implications and identifying any potential tax advantageous outcomes which might be linked to the transaction.

Tax due diligence would involve a thorough examination of the target company’s tax records, as well as looking at how well they adhere to regulations and identify any vulnerabilities that might exist. 

As part of this tax due diligence process we would include identifying any outstanding tax, seek to find any undisclosed obligations and any highlight any tax strategies that might prompt further investigation by HMRC. 

The process could also help identify any potential fines that could fall due.

Some business transactions will, of course, have warranties and indemnities built into them which might offer you a degree of comfort.

Warranties and indemnities might mean you are able to recoup any unforeseen tax liabilities, but reliance upon these can be both expensive and time consuming.  

Our tax due diligence team work to detect risks in the initial stages of a transaction.  This enables you, or our Corporate Finance team,  to negotiate more favorable terms, distribute any potential risks effectively, and adopt a more effective post-transaction integration strategy.

    Tax due diligence
    What areas of tax might we look at as part of our tax due diligence?
    • Corporation Tax 
    • Employment Related Securities 
    • Employment Tax 
    • Share and Share Option Schemes
    • VAT 
    • Research and Development Tax
    • Changes to group structures and any previous restructuring  
    • Any potential tax exposure which might have resulted from past tax planning
    What does our tax due diligence service involve?

    Our Corporate Tax team have more than 20 years of experience in tax due diligence. They can build a plan which is unique to you and your business and helps you meet your needs and objectives.   We can help:

    • Identify any potential tax exposure which might have resulted from past tax planning
    • Identify any exposure to future tax liabiities
    • Highlight any current or potential tax planning opportunities that might exist as part of the transaction 
    • Provide tax opinions and recommendations. 
    What is our approach to tax due diligence?

    RPGCC’s approach to tax due diligence is to work with you in a way that is both clear and transparent.   

    We will work closely with our Corporate Finance team who will be looking at the financial due diligence.  We will also work closely with your legal team and any related financial advisors to ensure that we fully understand the transaction, your goals as well as your attitude to risk.

    We will always deliver our results and findings in a clear manner highlighting any issues and making the relevant recommendations.  

    If you would like to speak to a member of our Corporate Tax team about a potential tax due diligence assignment or our  Corporate Finance team about financial due diligence, M&A, business sale or purchase or a business valuation contact us or telephone us on 020 7870 9050.  Or you can visit our web chat in the bottom right corner which is manned during office hours and you can leave a message out of hours. 

    The RPGCC team are always just a click or call away.

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