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The Family Business

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  1. Have you identified a suitable, qualified successor for your business?
  2. Are you ready to start taking a step back from the business?
  3. What is the value of the business and what is your share in the business
  4. What value do you want from the business?
  5. What value do you actually require from the business?

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A typical situation is a family company where the majority shareholder is coming up to retirement age and has identified a successor for the business.

The most common value extraction strategy would be to

a)    maximise the pension fund value prior to retirement and

b)    obtain maximum CGT retirement relief exemption in respect of their shares.

c)     obtain CAT Business Property Relief (e.g. a 90% reduction) for the beneficiary on the value of
the shares they are gifted.

In some cases this may not be enough e.g. the maximum pension fund may not be sufficient to pay all loan liabilities, in which case an alternative plan must be devised to maximise value extraction while minimising tax exposure.

In summary, there are multiple options available for various circumstances.

Your tax advisor can evaluate each of those options with you to come up with the most efficient solution for your particular needs.

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