The cost of late tax thinking
Transactions structured without tax input at the front end routinely produce one of three outcomes. A higher effective rate than the model assumed. A withholding or transfer pricing exposure that surfaces post-close. A holding structure that blocks repatriation or future exit. Each is expensive; each is preventable.
A deal structured without tax in the room is a deal that pays for the omission later, often at a multiple of the advisory fee that would have prevented it.
Where tax belongs in the deal sequence
Tax should be present at three moments: when the structure is being chosen, when the purchase agreement is being drafted, and when the integration plan is being built. Bringing tax in only at the third moment treats it as a compliance task rather than a structuring discipline.
At structure selection, the question is which entity, in which jurisdiction, holds what. At drafting, the question is how warranties, indemnities, and tax covenants allocate risk. At integration, the question is how the transaction's tax positions are operationalised in the combined business.
What good looks like
A transaction that has been structured well leaves the closing table with a written tax memorandum that explains the rate the business will pay, the residency and permanent establishment positions it relies on, and the points at which the structure has to be revisited. Anything less, and the next surprise is already in the file.
