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or via a loan. Control can be exercised through the use of Alphabet shares (i.e. different share classes carrying different voting rights and rights to dividends). Over time, this can be flexed to pass more control and therefore value, as desired.

The structure is relatively flexible in the way you can generate an income from it, dividends, salary, loan interest etc. The company will be subject to Corporation Tax on its profits at the current rate of 19%.

If this then provides you with excess cash to spare then you may wish to consider investing in assets that can defer either the Capital Gains Tax due or qualify for IHT relief

Business Property Relief (BPR)

If you currently own a trading business then the value of that asset may at present qualify for Inheritance Tax BPR, potentially reducing the value of your estate by up to 100% of the value of that business. But what if you are considering retiring or selling the business, the result of which is that the asset is replaced by cash in your estate increasing your exposure to IHT? You could consider a FIC structure and/or investing in other BPR qualifying assets, such as AIM listed shares. AIM listed companies tend to be slightly higher risk and investment advice from a suitably qualified professional is recommended.

Investment into EIS/SEIS or VCT schemes

Eligible subscriptions into these schemes may result in Income Tax savings and Capital Gains Tax deferral, or exemption, provided certain conditions are met upon ultimate disposal. Whilst the tax relief is beneficial, the investments do carry more risk and good financial advice is essential.

As accountants and tax advisors, whilst we can advise you on the tax implications of your plans, we cannot offer investment advice, although we can put you in touch with suitable professional firms who do offer this.

For more information on Trusts and other tax planning articles, please see our website or contact us.

Contact Rob Case for more information by emailing rob.case@randall-payne.co.uk or call 01242 776000.

Bite-Sized Thinking

› Investing in residential property may offer a good return on your capital, however there are CGT and IHT implications to bear in mind.

› If you have surplus cash to invest then a structure such as a FIC, or investments in AIM listed can offer

IHT savings at the same time as a potential return.

To find out more about any of the topics discussed in this article, visit randall-payne.co.uk