Looking To The Future
The experts at Raymond James explain how new business owners can navigate what can be a complex journey
In the previous issue of this magazine the experts at Raymond James, Ribble Valley explored some of the issues around succession planning. The article was written from the perspective of an owner wishing to exit their business. Readers expressed an interest in understanding the issues from the other perspective, that of the business’ new owner.
THE STARTING POINT
Owning or taking over a business is an honour. But can come with significant challenges and burden. Be kind to yourself as you navigate this journey and remember you’re not in it alone. Having a strategic financial plan and a trusted financial advice partner can make a real difference, giving you a clearer picture of the years ahead.
Raymond James, Ribble Valley has expertise in working with business owners and company directors to help put that strategic financial plan in place. Typically, we work with our clients on the following topics:
EXTRACTING FUNDS TAX EFFICIENTLY AND REDUCING CORPORATION TAX
Making employer pension contributions is a way to get funds out of the business into your own name, whilst reducing your corporation tax as a business expense. The current maximum amount a business owner can potentially withdraw out of their business into a pension is £220,000, which would attract no personal tax, as well as reduce the business corporation tax bill by up to £55,000.
As well as pension contributions there are other solutions, which Raymond James can help with. One example is by setting up an investment corporate account, investing surplus cash within the business or an associated investment company within the group structure. Dividend payments from your investments to your business typically won’t attract corporation tax.
BUSINESS PROTECTION
It is advisable to have contingency plans in place if anything happens to you or key employees. What happens to the business if you die or can’t work for a sustained period because of an accident or illness?
Our experts can help you take out insurance plans and put agreements in place that ensure you are taking care of you and your family, protecting your legacy and protecting your employees.
BRINGING YOUR PROFESSIONAL PARTNERS TOGETHER
Planning for business owners is extensive and often involves various partners such as an accountant, tax specialist and corporate solicitors. We can introduce you to additional services where required, to ensure you have a quality team of professionals around you that are aligned with the same goals.
SECURING LIFE AFTER BUSINESS
Helping prepare you and your business for exit – including achieving financial independence – or having an effective succession plan in place to secure the future of your business is a key aspect of our work. Although you may plan to sell your business at some point, there is no guarantee it will be worth what you expect it to be worth or you may also be passing it down to the next generation. When one income stream stops, it may need to be replaced with another one.
If you are considering any of the opportunities presented by either exiting or running a business, please contact our team for an initial consultation and see how we can add value, working together for the long-term, ensuring the best outcome for you.
Risk warning: This article is intended for informational purposes only and no action should be taken or refrained from being taken as a consequence without consulting a suitably qualified and regulated person. With investment, your capital is at risk. Tax treatment depends on an investor’s individual circumstances and may be subject to change.
Raymond James Investment Services Limited
8 Berry Lane, Longridge
Preston PR3 3JA
01772 780300
ribblevalley.raymondjames.uk.com
