Secure your legacy, and reduce tax liabilities using a Family Investment Company.
Case Study:
Vip Varsani
The following case study illustrates the utilisation of a Family Investment Company (FIC) with a view to creating a long-term investment plan that is tax efficient and protects assets from Inheritance Tax.
Overview
Vip owns a public sector business that deals in Post Office products, services, and staff development. When he initially approached TLPI, Vip was looking at long-term investment strategies and structures that would facilitate further investment opportunities in the most tax efficient way.
Whilst Vip already holds a few properties, he was open to making further investments via a different set-up to improve his tax position. This would also ensure his future investments were ring-fenced and protected from excessive Inheritance Tax liabilities for his son, should the worst happen.
The Situation and Goals
Vip had already been making property investments before he started working with TLPI. Going forward, however, he felt there must be a better way to hold and protect his assets, whilst minimising the tax bill on them.
He started his initial search with his son’s future in mind – how could he continue to make profitable investments which he could pass through his family without racking up a large tax penalty?
Overall, Vip was looking for a solution that achieved the following goals:
- To make long-term investments in a tax-efficient manner
- To ring-fence these investments and retain total control, whilst ensuring they are protected for his son
- To grow his investment property portfolio
“The Family Investment Company was totally new to me. I wasn’t aware of it at all before speaking to TLPI.”
The Approach
TLPI’s aim is to understand an individual’s situation through an initial free consultation which covers what the client is trying to achieve and how we can remove the pain points taking up their time, energy, and resources.
Vip and his son had multiple conversations with their TLPI consultant, in which Vip was able to discuss any uncertainties he may have had. “We were a bit unsure on how to progress with it, but our consultant helped us both to understand. He explained the benefits of the Family Investment Company and how TLPI would help us with our journey,” Vip recalled.
Working with our clients, we aim to:
- Understand their personal situation
- Apply expertise and knowledge of over one thousand tax benefits and subsidies available to company directors
- Provide the knowledge and understanding needed to make informed decisions about ALL their wealth assets and options
- Apply 360° strategies to mitigate tax liability
- Achieve the control and flexibility required to leverage current wealth to grow the business and assets
- Free up time, by consolidating the many areas of the business and personal
financial situation into one strategy for optimising tax and growth
Who?
TLPI offer a free, no-obligation consultation to get the full picture of a client’s situation and provide them with their options. Each client is assigned to their own dedicated consultant who takes the time to assess the individual situation and advise on whether the structures that TLPI offer would be appropriate, and if so, how to best tailor them to the specific circumstances.
Vip and his son attended the consultations together, gaining a full understanding of how the Family Investment Company could work for their personal and business aims and goals. After receiving all the information and facts from their TLPI consultant, they decided that the Family Investment Company structure was the right product for their situation and worth going ahead with. Throughout the rest of the process, Vip was pleased to find that TLPI “kept in touch and sent regular communication on everything that was going – it was fantastic.”
Why?
The Family Investment Company is the ideal, tax-efficient wrapper for purchasing and holding property, whether that be commercial or residential. When connected to an existing trading company, as with Vip’s situation, it becomes simple to transfer surplus company cash into the FIC.
The FIC involves a trust element to protect its contents and separate them from the family estate, therefore eliminating any potential Inheritance Tax on the assets held within it. However, unlike a traditional trust, the Family Investment Company offers more flexibility and control over the funds and what to do with them.
How?
Vip can move surplus company cash from his existing limited company over to a Family Investment Company, which not only will bring down his trading company’s year-end tax bill but will provide funding for his future investments. Alternatively, he can make a director’s loan into the FIC with his personal funds.
Once these investments have been made, they will be held and protected within a ring-fenced, tax efficient structure. They will also be protected from a hefty Inheritance Tax bill for his son, should the worst happen.
TLPI are registered with HMRC to set up Family Investment Companies on behalf of our clients.
The Result
Vip now has his Family Investment Company set up and is ready to start making investments. It is connected to his pre-existing limited company, which can move funds into the FIC to use for investment purposes.
Vip is still in the early days of his Family Investment Company journey. Whilst he has yet to make any investments, he is actively looking to do so and making sure to do the necessary due diligence. He notes that when he does come across something that takes his interest, he will use his Family Investment Company to make the purchase and hold the property.
TLPI provide ongoing investment information, strategy consultations, and tax updates. When Vip is ready to make investments through his Family Investment Company, his consultant is at the end of the phone to support him, whether that is with administrative, strategy or structure advice.
“I’m doing my due diligence as I search. I’ve not come across anything yet, but as and when I do, everything will be through my Family Investment Company.”
Summary
For those in a similar position, Vip says “go for it! It’s a great venture and great for anyone looking to increase their portfolio or long-term investments, whilst keeping them within the family.”
Even if you are not sure if the Family Investment Company fits your specific situation, Vip suggests it is still worth looking into: “At least get some advice from experts and see if it could benefit you.”
“If anyone is thinking about investing and diversifying their portfolio, they should look into the Family Investment Company.”
Thank you to Vip for sharing his Family Investment Company story. Each of our clients’ situations are different and require bespoke approaches to achieve the best outcome. Our aim is always to understand your personal situation and provide advice and support that fits around your aims and goals.
Book a free, no obligation call with one of our consultants to find out more about the Family Investment Company and whether TLPI can help you achieve your investment and tax saving goals.
Our clients rate us as 5 star, here’s what they say:
jonathanwaters1953
26/07/2023
We have recently used this excellent company to set up a Family Investment Company. The complete process was seamless with our personal contact Jordan Sharpe explaining all the steps along the way in a very confident and professional way. They really do deserve this 5 star review.
Keith Jones
26/06/2023
Tlp have been fantastic with there advice and help in setting up my retirement plans , putting structures into place to help with future generational hand over of assets, great advice from Jordan Sharpe, easy to deal with and always on hand for help when needed, well done all, 👏 ✔️
Stewart Yardley
05/06/2023
Trustworthy Financial Advice with an Eye on the Future. I recently sought financial advice, and trust was my top priority. TLP not only met my expectations but exceeded them. Although their product didn't suit my current needs, their dedication to providing comprehensive information and support left me confident in utilising their services in the future. TLP's commitment to customer satisfaction was evident from the moment I approached them. They patiently and thoroughly discussed all available options with me, ensuring I understood the pros and cons of each. Despite not making an immediate sale, they generously shared their time and expertise, demonstrating a genuine interest in helping me make the right decisions. What impressed me the most about TLP was their transparent and honest approach. They didn't try to push any product on me that wouldn't serve my current financial situation. Instead, they focused on empowering me with the knowledge I needed to make informed choices. Their willingness to prioritise my needs over immediate profits spoke volumes about their integrity. I left my interaction with TLP feeling informed, confident, and assured that when the time is right, they will be my go-to financial advisory service. The trust they have established with me through their professionalism, dedication, and genuine care for my financial well-being is unparalleled. I have no hesitation in recommending TLP to anyone seeking trustworthy financial advice.
Robert Sidebottom
25/05/2023
I was looking at setting up a Family Investment Company, during which I’d paid more than a few hundred pounds for a couple of Consultations. After which I’d received some rather expensive quotes for setting it up, as well as getting lots of complexed information about the process.
Then I eventually stumbled across TLP while doing some related research. I was pleasantly surprised and more than pleased that they offered a No cost consultation. During which Lewis Jones, was able to simplify all the information and subsequently provide a much more realistic quote for the process. Not to mention the first year’s company accounting services that came for free and the ongoing advice from Lewis. Which has not only been financially beneficial, but as proved to be a great source of knowledge and education, responding to all my questions promptly. With my background not being in the financial and investment sector, his clear explanations put in a context that I was able to understand, has been invaluable.
Geoff Saunders
22/05/2023
Great support all the way through the process very professional good knowledge and friendly service. I would highly recommend
Andew Clymo
21/02/2023
From the start of the transfer to the end TLP have been always available to me, they have kept me informed throughout the process and offered help and guidance when required. Excellent service that is highly recommended
Andy Page
25/01/2023
Now fully set up with a Landlords pension and very pleased with the overall service. Only delays were with AVIVA not playing ball but now all done and set to earn significantly more than with AVIVA. Jordan Sharpe was knowledgeable and guided me through the whole process with a professional and friendly approach. Morwena (assistant) was again very friendly and together made the process a simple one. Looking forward to a better retirement (eventually) thanks to TLP.