What’s the Best Way to Sell Your Business?
By Joseph Spiers
Explore the main ways to sell a UK business, compare trade sales, management buyouts and Employee Ownership Trusts, and understand the latest tax relief changes.
Selling a business can be one of the biggest financial decisions you make. After years of building a company, you will want to achieve a fair price, protect the value you have created and make sure the proceeds support your plans for the future.
But there is more than one way to sell a business. You could sell to a competitor, find a private buyer, pass the business to your management team or explore an Employee Ownership Trust (EOT). Each option has different implications for the sale price, how you leave the business and the amount of tax you may pay.
Tax rules have also changed in recent years. Business Asset Disposal Relief (BADR), previously known as Entrepreneurs’ Relief, now offers a reduced Capital Gains Tax rate of 18% on qualifying gains, rather than the 10% rate that applied until April 2025. Meanwhile, the tax relief available when selling to an EOT was reduced from 100% to 50% of the gain for qualifying disposals made on or after 26 November 2025.
So, what is the best way to sell your business? The answer depends on your priorities, the type of business you own and what you want life to look like after the sale.
What are your options when selling a business?
Before deciding how to sell, consider what matters most to you. Is your priority to maximise the sale price, complete the sale quickly, protect your employees or retain some involvement in the business?
Sell to another business
A trade sale involves selling your company to another business, often a competitor or a company operating in a related industry. A buyer may be willing to pay a premium if your business gives them access to new customers, technology, skilled employees or a stronger market position.
Potential advantages:
You may attract competitive offers from several buyers.
The buyer may have the resources to complete the transaction.
You could negotiate a clean exit, depending on the terms.
Potential drawbacks:
The buyer may restructure the business after the sale.
Due diligence can be lengthy and intrusive.
Part of the price may depend on future performance or your continued involvement.
A trade sale may suit owners whose main aim is to achieve the best possible commercial offer, although the highest headline price is not always the best deal once tax, costs and payment terms are considered.
Sell to your management team
A management buyout (MBO) allows the existing management team to buy the business. Because the managers already understand how the company operates, the transition may be smoother than a sale to an unfamiliar buyer. The management team may use its own funds, bank finance or external investors. In some cases, the seller agrees to receive part of the purchase price over time.
Potential advantages:
You may be able to sell to people you know and trust.
The business can retain its existing culture and leadership.
You may be able to agree a phased handover.
Potential drawbacks:
Your managers may not have enough…