Direct answer
The short answer
Before buying a business, define exactly what is being acquired, investigate the target beyond its headline accounts, build the complete transaction and working-capital requirement, and test how the combined business would support its commitments. Companies House information is a useful starting point but is not a substitute for legal, financial, tax or commercial due diligence.
Key points
- Define whether the proposed transaction concerns shares, selected assets or another agreed structure with professional advisers.
- Check public filings, then reconcile them with current management information, contracts, assets, liabilities and cash flow.
- Budget for professional work, tax, completion adjustments, integration and working capital as well as the headline price.
- Keep the purchase decision, professional due diligence and any finance assessment separate.
Define what the transaction includes
Record the proposed buyer, target, price, timetable and what is expected to transfer. Shares, selected assets, property, stock, contracts, employees, intellectual property and liabilities can require different treatment. Ask suitable legal and tax advisers to confirm the transaction structure rather than relying on the marketing description.
Use public records as a starting point
Companies House can show information such as status, officers, filings, accounts dates, charges and insolvency information. Its own guidance says the register is not comprehensive, so use it to identify questions and documents rather than treating it as a complete investigation of the business.
Reconcile historic accounts with the current position
Review filed accounts where available, then ask for current management information, bank and tax evidence, aged debtors and creditors, stock and asset records, existing borrowing and contingent commitments. Understand any material difference between historic results, current trading and the figures used in the purchase proposal.
Test customers, suppliers, contracts and operations
Identify concentrations, cancellations, disputes, change-of-control clauses, licences, leases, employment obligations and dependencies on an owner or key employee. Confirm what evidence supports recurring revenue, margins and future assumptions. Professional due diligence should be proportionate to the transaction and risks.
Build the full completion and integration plan
Set out the headline consideration, professional fees, tax, refinancing or settlement items, stock or working-capital adjustments, immediate repairs or investment, systems changes, insurance and cash needed after completion. Record who is responsible for each item and when payment is due.
Test how the combined business would support commitments
Use a cautious cash-flow forecast that reflects the acquisition price, existing commitments, integration costs and the timing of customer receipts and supplier payments. Model a weaker case, such as lower sales, delayed integration or the loss of a major customer, without treating the forecast as proof that funding is affordable or available.
Keep each decision with the right professional
A solicitor, accountant, tax adviser, commercial specialist and finance provider may examine different parts of the transaction. Bene does not value businesses, conduct due diligence, provide legal or tax advice, recommend finance or decide whether a purchase or funding structure is suitable.
Common questions
Questions about this guide
Is a Companies House check enough before buying a business?
No. The register is a useful public source, but Companies House states that its information is not comprehensive. The buyer should agree proportionate legal, financial, tax and commercial checks with suitable professionals.
Should working capital be planned separately from the purchase price?
Yes. Record the cash needed to complete the transaction and the cash needed to operate and integrate the business afterward. Their timing, evidence and possible funding treatment may differ.
Can Bene tell me what a business is worth?
No. Bene is an introduction service and does not value businesses, conduct buyer due diligence, recommend an acquisition or provide legal, tax, accounting or financial advice.
Primary sources
Sources reviewed for this guide
- Making business finance work for youBritish Business Bank
- Searching the Companies House registerCompanies House
- Preparing and filing Companies House accountsCompanies House
- Preparing for funding applicationsBusiness.gov.uk
- Getting your business ready for financeBritish Business Bank
External sources provide general context and do not endorse Bene Finance or establish that a funding option is available.
This guide provides general information only and is not financial advice or a guarantee that finance will be available.