RAC members in for windfall tax breaks
Advisers to the RAC are close to producing a package of tax breaks for members expecting a windfall from the #450m sale of its motoring division.
Price Waterhouse and Dresdner Kleinwort Benson are expected to have a package ready by the end of June, in time for the planned sale to US company Cendant.
Kate Holgate at Dresdner Kleinwort Benson’s corporate finance division said: ‘We are working to a solution that should be extremely tax-efficient.’
Sale of the motoring services, principally the breakdown network, should produce between #33,000 and #35,000 for the RAC’s 12,065 full members.
An RAC spokesman said: ‘We are looking at various options that are applicable to the members paying #623, effectively the shareholders.’
The Inland Revenue refused to comment on its plans to tax the windfall.
The urgency of proceedings could be disrupted by revelations that Cendant, owners of the Green Flag breakdown service and National Car Parks, faces claims of accounting irregularities in the US.