Saving your time, enhancing your wealth.

As a specialist in providing advice to company directors and shareholders we can help you and your business develop the right strategies to maximise the use of company profits and minimise the payment of unnecessary tax to ensure that your family and business wealth is preserved for current and future generations.

Mackay Macpherson

This area of planning will ensure that the value of your business assets will pass to your estate in a tax-free manner should you die before retirement, or alternatively ensure that you continue to control your business on the death of a co-shareholder.

Our experience in this area has shown that the death of a shareholder creates a multitude of potential problems which can, with clever planning, be controlled.

These problems may include:

  • How does their death affect the business?
  • How much are their shares worth?
  • How do we value the shares?
  • Who has the money to buy their shares?
  • How do I continue to exercise control of my business?

Many shareholders following advice take steps to try to ensure that, should they die prematurely, then their fellow shareholders have funds available to purchase their shares, leaving their families with the money and the surviving shareholders with control. This is done by establishing a shareholder agreement with specialist legal advice combined with taking out life policies written under Trust.

This sensible planning may have tax consequences via pre-owned assets tax which many people in the past, including life offices and their advisors, failed to address.

Pre-Owned Assets Tax: This taxes certain transactions that people entered into after March 1988 and is retrospective. It has already caught out tens of thousands of company shareholders who joined in arrangements with each other to ensure that, should they die prematurely, their family would obtain the value of their shares quickly and the surviving shareholders could continue with the business. HMRC have confirmed that the above arrangements are caught by this tax. As a result, you may already have a tax liability of which you are almost certainly unaware. The tax, interest and penalties may already be substantial for you and will be payable every year. The situation can be remedied but needs urgent action.

If any of the issues are of a concern to you, you should ensure that strategies are in place so that your assets are protected and your wealth remains within your family.