Share Holder Trusts

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Shareholder trusts provide significant protection to your business and reduce the possible impact of Inheritance Tax dramatically. The business and proceeds from a future sale of the business are protected for the family bloodline from IHT, remarriage, creditor claims and residential care fees.

Our bespoke planning leaves each partner or director’s share of their business to individual Family Trusts through appropriate clauses written into their Wills.

Furthermore, the Life Cover will also be assigned to ‘Shareholder Trusts’ so that these proceeds do not impact on the surviving individual estates.

Once the Cross Option has been executed, the proceeds from any Life Assurance policy replaces the share(s) held in the deceased’s Family Trust(s) and so do not form part of the beneficiary’s estate. These funds are now protected against any of the risks named above and the surviving spouse and beneficiaries still have full access to the Trust assets.

“Our bespoke planning enables all sides to benefit from the increased wealth created as a result of insurance payouts. Our innovative trust strategies, protect payouts tax efficiently. The surviving business partner(s) maintain control and the surviving family benefit from your work in building the business.”

Find out more about our estate planning services, call 0800 240 4587 or complete the form below.

FAQs – Shareholder Trusts

How does this benefit the remaining business partner(s)?

The surviving business partner still retains their original share of the business, but the deceased’s partner’s share is passed directly into a Shareholder Trust(s) from where the Life Assurance proceeds were originally paid. The surviving Director still has the fullest of control on the business as he is a Trustee of the Shareholder Trust(s).

How is the Shareholder Trust beneficial from a taxation perspective?

The Shareholder Trust(s) can also be utilised as a further efficient income tax planning tool. Now that a proportion of the business is in the Shareholder Trust(s) any dividends paid into the Trust(s) could be distributed to beneficiaries of the trusts that may well have nil or low rate income tax.

What other benefits are there for having a Shareholder Trust?
Should the surviving Director(s) decide to sell the business, only their original share of the business will enter their estate. The remaining share will belong to the Shareholder Trust(s) for which he and his family are beneficiaries.
What beneficial impact will selling the business shares have using a Shareholder Trust strategy?
This provides a significant Inheritance Tax advantage, whilst protecting the beneficiaries from 3rd party claims upon them.

“I believe your patient approach in explaining technical legal matters made the process much simpler and now I am confident my estate and wishes are properly represented in my new Will & Trust. Many thanks Michael, I appreciate your diligence.”

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