Family Investment Companies

One of the keys to a successful future in business and in life

Family investment companies can represent an effective way to pass down wealth to future generations while minimising the amount of inheritance tax you owe.

At Equilibrium, we can advise you on the best routes to take as you look to pass on your assets to your loved ones in the most efficient way possible.

Find out more about how we can help you and your family today by contacting our specialists. With offices in Wilmslow and Chester, we are on hand to provide the advice you need. Call us on 0808 156 1176 or complete our online contact form, which will enable us to call you back at a convenient time.

About Family Investment Companies

A family investment company is a private limited company that counts family members as its shareholders. It is often used as a tax-efficient way for an individual to make cash transfers into a company, with the cash often invested in order to boost the family's income.

With regard to inheritance tax, one of the main benefits of a family investment company is that a gift of shares from a donor to another individual would not result in any immediate inheritance tax charge because it would be classed as a potentially exempt transfer, or PET. Also, should the donor continue to live for seven years after making the gift, they will face no further inheritance tax implications regarding the gift.

Other tax benefits of using a family investment company include:

  • Transfers into the company are tax-free
  • Tax is only paid by the company at 20% of generated profits
  • Shareholders are only required to pay tax in relation to the extent that the company distributes income (no tax is payable should profits be retained within the company)

In addition to tax-related benefits, another major advantage of a family investment company is that the founders of the company have total control with regard to decisions concerning investment, while the value of the assets are handed over to the next generation in the form of shares.

Contact Us Today

Find out more about how our specialists can assist with your financial planning and how a family investment company may benefit you and your family today by getting in touch. We have supported many clients from across the North West, including in Manchester and Cheshire. Either call us on 0808 156 1176 or complete our online enquiry form and a member of the team will call you back.