Legal Issues in the Disposal of a Business
Asset and share sales, authority, contract terms, employees, liabilities and completion.
How to study the ATT Qualification
Use Finance Act 2025 for the 2026 tax papers, complete the three foundational CBEs early, apply professional ethics throughout and concentrate option practice on the one paper you will enter.
Core concepts
Concept 1
An asset sale and share sale transfer different legal rights, obligations and risks.
Exam cue: Identify exactly what legal interest is being sold.
Concept 2
The seller must have authority and title to transfer the relevant property.
Exam cue: Map contracts, employees, debts and approvals to transfer steps.
Concept 3
Contracts allocate warranties, indemnities, conditions and completion obligations.
Exam cue: Separate tax consequences from the underlying legal transaction.
Risk pitfalls and guardrails
Assuming liabilities automatically transfer with assets.
Guardrail: Do not use an obsolete tax rate, assume a relief, ignore legal form, submit unsupported information or omit the relevant deadline and ethical response.
Ignoring third-party consent.
Guardrail: Do not use an obsolete tax rate, assume a relief, ignore legal form, submit unsupported information or omit the relevant deadline and ethical response.
Giving tax treatment before confirming legal form.
Guardrail: Do not use an obsolete tax rate, assume a relief, ignore legal form, submit unsupported information or omit the relevant deadline and ethical response.
Memory anchors
Asset sale
Select assets and liabilities transfer individually as law and contract permit.
Share sale
Ownership of the company changes while company assets remain with it.
Title
Confirm ownership and power to transfer.
Warranty
A warranty is a contractual statement supporting a damages claim if false.
Indemnity
An indemnity allocates specified loss directly.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
A buyer acquires a company's shares rather than selected assets. What generally remains with the company?
A buyer purchases selected business assets from a company. What must be addressed for contracts to move?
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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