This is a significant change to the way in which earn-out arrangements had been treated and it will be important for all commercial advises to understand the impact of these new changes, which take effect from the date of release of the exposure draft legislation, 23 April 2015.
Changes to the treatment of earn-outs were originally announced on 12 May 2010 and significant consultation and development of draft legislation has occurred since that date, including when the Government reviewed the then announced unenacted measures in December 2013.
This event provided valuable insight into how the new rules will apply to business sales going forward.