SME Adviser Series: Shareholder Focus

With the recent changes to IHT and CGT announced in the Autumn Budget now is the time for owner-managers to review their company and shareholder structures.

Often original structures are maintained despite substantial growth, new shareholders, new acquisitions or just new objectives. This can lead to significant tax bills in the future.

A review will highlight opportunities for a more tax-effective structure for the business or for holding investments. It is also useful in preserving value when ambitions or business strategies of shareholders diverge – a frequent occurrence in family-run businesses. The owners may also want to extract value from the business, whether by means of an on-going, tax-effective salary/dividend strategy or by a disposal of some or all of the shares held. And individuals can look at using trusts to protect assets and to reduce or eliminate the impact of tax.

A proper focus on the shareholder would involve these issues being considered at the same time as the company’s structure is being reviewed. Even where there are no tensions in the business there may be succession planning issues or simply missed tax planning opportunities that involve corporate restructuring.

For further information, please contact your usual Beavis Morgan Partner or email

Further reading: SMEs must plan now for the future