Before signing a business broker agreement in the UK, check every payment and trigger, not just the headline percentage. That means any upfront fee or monthly retainer, the success fee and minimum fee, how transaction value is defined, milestone payments such as at Heads of Terms, refund terms, exclusivity, protected buyers and tail periods, VAT, termination and notice, service scope and reporting, and who pays third-party costs.
The checklist
Work through each point and make sure the agreement answers it in writing:
- Upfront fees: is anything payable on signing, and what does it cover?
- Monthly retainers: how much, for how long, and are they capped or credited?
- Minimum fee: is there one, and how does it affect a smaller sale?
- Success fee percentage: is it a single rate or progressive bands?
- Transaction value: does it include deferred, contingent or earn-out consideration, assumed debt or retained assets?
- Heads of Terms or milestone payments: when are they due, and are they credited against the final fee?
- Refundability: which payments, if any, can be refunded or credited, and when?
- Exclusivity: how long is the exclusive period?
- Protected buyers and tail period: who is protected, for how long, and how is the list shared?
- VAT: are the figures quoted before or after VAT?
- Termination and notice: how can either side end the agreement, and what remains payable?
- Service scope and reporting: what work is included, and what reporting will you receive?
- Third-party costs: who pays for advertising, data rooms, legal or accounting work?
Why transaction value matters
The definition of transaction value decides what the percentage is applied to. Two agreements with the same headline rate can produce very different fees if one includes deferred or contingent consideration and the other does not. Ask for the definition in writing.
VAT
Broker fees are generally subject to VAT where the broker is VAT-registered. Check whether quoted figures include VAT, and ask your accountant whether you can recover it in your circumstances.
Getting advice
Where the commitment is material, ask a solicitor to review the agreement and an accountant to check the cost against your expected sale proceeds. Independent advice is usually far cheaper than a dispute later.
Offsell's approach
£0 upfront is Offsell's standard service for qualifying UK businesses. That means no upfront engagement fee and nothing to pay to start the sale process. It is not a 'no sale, no fee' arrangement: a Heads of Terms stage payment becomes due when Heads of Terms are signed and is credited in full against the completion fee.
Frequently asked questions
What is the most important clause in a business broker agreement?
There is rarely a single one. The fee clauses, the definition of transaction value, exclusivity and the tail period usually have the biggest effect on what you pay and when.
What is a tail period in a business broker agreement?
A tail period is a period after the agreement ends during which a fee may still be payable if you sell to a buyer the broker introduced or approached. Check its length and how protected buyers are identified.
Are business broker fees quoted with or without VAT?
It varies. Many are quoted before VAT. Check the agreement and confirm the position with the broker and your accountant.
Who pays third-party costs in a business sale?
It depends on the agreement. Sellers usually pay their own legal and accounting advisers; advertising, data room or other costs may be included in the broker's fee or charged separately.
Can I change the terms of a broker agreement before signing?
Often, yes. Brokers may agree changes to exclusivity, notice, tail periods or payment timing. Make sure any agreed change appears in the signed document.
How is a minimum fee applied?
A minimum fee usually applies when the percentage-based fee would be lower than a set amount. On a smaller sale, the minimum can mean the effective rate is higher than the headline percentage.