The benefits of a Family Investment Company
By International Adviser, 30 Jul 18
People wanting to protect and maintain control of family wealth are increasingly turning to family investment companies. Ravi Francis, senior associate solicitor at Irwin Mitchell Private Wealth outlines the benefits and drawbacks of using such a structure.
One key risk is the potential for double taxation, although there are various ways this can be mitigated.
The FIC’s profits will generally be subject to corporation tax and any distributions, as dividends may also be subject to income tax.
Another issue is the transparency required for UK corporate entities.
If structured as a limited company, an FIC will need to file an annual return with Companies House, which will contain details of the directors, shareholders and the annual accounts.
The FIC will also need to publish details of ‘persons with significant control’, which would involve identifying the ultimate beneficial owners and controllers.
It is also important to appreciate the corporate administration and financial regulation required when running an FIC.
As with any kind of estate planning, it is important to get specialist advice on the set up and ongoing administration of an FIC.
Tags: Irwin Mitchell
