Selling a business in the UK: What you need to prepare (2025 guide)
Published 8 July 2025
Selling a business is a major decision, and often a life-changing event. Whether you’re planning for retirement, pursuing a new venture, or simply ready for a change, preparing your business for sale in the UK requires careful planning and the right professional advice.
Having supported business owners through this journey, I have seen how preparation reduces stress, builds confidence, and helps secure the best outcome - both financially and emotionally.
Here is a step-by-step breakdown of what you need to do when selling your business in the UK.
1. Know why you are selling your business
Understanding your motivation is the first step in the business sale process. Common reasons include:
Retirement
New business opportunities
Personal circumstances
Burnout or lifestyle changes
Being clear on your "why" shapes your timeline, strategy, and how you communicate with potential buyers.
2. Build a trusted team for your business sale
Selling a business involves complex legal, tax, and financial considerations. Don’t go it alone.
Your core team should include:
Financial adviser - Considers your life during and after the sale, including effective tax planning and investment strategies
Accountant - Ensures your accounts are accurate and attractive to buyers
Solicitor - Manages legal contracts, liabilities, and transfer of ownership
Tax adviser - Helps you structure the sale tax-efficiently
Business broker - Markets your business and negotiates with buyers
These professionals will guide you through the process and help protect your interests.
3. Get your business financials in order
One of the first things buyers will request is access to your financial documentation.
Ensure you have:
Clean, up-to-date accounts (preferably 3+ years)
Balance sheets and cash flow statements
Payroll, VAT, and HMRC filings
Forecasts and projections
Details of debts, liabilities, and assets
Transparency builds trust and speeds up due diligence.
4. Understand what your business is worth
A professional business valuation gives you a realistic idea of your market value and provides a foundation for negotiations.
Factors influencing valuation:
Profitability
Assets (physical, intellectual, brand value)
Market conditions and industry trends
Client/customer contracts and retention
Growth potential
Consider getting valuations from a broker and your accountant for comparison.
5. Review legal and operational details
Buyers will look closely at your operational readiness. Make sure:
Contracts - leases, suppliers, customers - are up to date
Licensing & compliance is in order
Business assets - equipment, IP, trademarks - are documented
HR policies and employee files are well maintained
Cleaning up your legal and operational framework prevents hold-ups later on.
6. Support your employees through the sale
If you have employees, you'll need to comply with TUPE regulations (Transfer of Undertakings):
Inform and consult with staff early
Ensure continuity of terms and conditions
Handle redundancies (if any) legally
Your staff are key to a successful transition - keeping them informed and supported protects morale and business continuity.
7. Plan for tax when selling a business in the UK
Tax planning can make a huge difference to your final payout. A few things to consider:
Capital gains tax (CGT) - You may owe CGT on profits from the sale
Business asset disposal relief (BADR) - Formerly Entrepreneurs’ Relief, this reduces CGT if you qualify
Rate increased from 10% to 14% in April 2025
Set to rise to 18% in April 2026
Planning ahead with a tax adviser could save you tens of thousands of pounds.
8. Market the business professionally
To attract serious buyers:
Prepare a business prospectus or sale pack
Highlight your strengths, profitability, and growth opportunities
Consider a business broker or reputable online listing platforms
Buyers expect clarity and honesty - be ready to answer questions with detail and confidence.
9. Understand the sale process step by step
A typical business sale in the UK includes:
Initial valuation and preparation
Confidential marketing and buyer interest
Due diligence and negotiations
Heads of terms agreement
Legal drafting (SPA, warranties, etc.)
Completion and transfer of ownership
Stay involved and supported at each stage to avoid costly mistakes or delays.
10. Plan for life after selling your business
Many owners assume the sale will fund their retirement, but without proper planning, this can be risky.
Key considerations:
Do you have a pension or other income sources?
Will you invest the proceeds, start another venture, or retire?
Are your finances diversified beyond your business?
A financial adviser can help you make a plan for what comes next - whether it is relaxing, reinvesting, or reinventing.
FAQs about selling a business in the UK
How do I prepare to sell my business in the UK?
Start by organising your finances, getting a business valuation, assembling a professional team, and planning for tax. Legal and HR compliance are also essential.
What documents do I need to sell my business?
You will need profit and loss statements, tax filings and VAT records, lease and supplier contracts, employment agreements, a sale prospectus. It is best to consult a solicitor to understand any specific you may also need.
How is a business valued?
Valuation depends on profitability, assets, market trends, and future potential. An accountant or business broker can perform a professional valuation.
Will I pay tax when selling my business?
Yes, but you may be eligible for business asset disposal relief (BADR). This reduces the CGT rate, currently 14% in 2025, rising to 18% in 2026.
Final thoughts: Your business sale is the start of something new
Selling a business is a big move - but with the right planning, it can also be one of the most rewarding. With a clear strategy, proper support, and a focus on what comes next, you’ll be better positioned to achieve your goals.
☕ Ready to create your personalised financial plan? Book a no obligation Clarity Call
Let’s make your business exit smooth, profitable, and stress-free.
Your wealth wingwoman,
Shalini
P.S. It is never too soon, or too late, to start planning for your future self.
The value of an investment with St. James's Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.
The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.
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