Securing the future of a continuing family business can be a concern particularly where some members of the family are involved with the business but others are not.
The business can make up a large part of a person’s estate and they often want to make sure that the whole family benefits.
There are problems with passing direct ownership of a business to family members particularly if they become divorced or bankrupt. In such circumstances, the company shares can fall into the control of parties who are not sympathetic with the way the company is being managed which places the future of the business at risk.
Setting up a trust can provide a secure solution. The company shares can be held in their entirety by the trust and selected family members can be beneficiaries. This means that the family can benefit from the financial success of the business without having access to the shares themselves.
At present Business Property Relief (BPR) provides 100% relief from inheritance tax so, in most circumstances, there is no limit to the value that can be added to a trust in this way.
Please contact us for more advice.
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