Business Owners
At Carlile Alexander Private Wealth, we understand that as a business owner, your financial journey is unique. You’re focused on growing your company, managing both personal and professional finances, and securing your legacy. Our expert team is here to support you with bespoke wealth strategies that address your specific needs.
We offer guidance on key areas such as Shareholder Protection, helping you safeguard your business from unforeseen events that could disrupt ownership. Additionally, we explore the use of pensions as a tax-efficient tool to manage out profit, ensuring that you can optimize your financial structure while securing your retirement.
From succession planning and tax strategies to investment management, we’re committed to helping you protect your wealth and grow your business with confidence.
Relevant Life Cover
If you’ve ever worked at a large company that offered Death in Service, this is the small business equivalent. The policy can be established by the company on the life of a shareholder/director with the proceeds left in trust to their family. The business pays the premiums, and this can be offset against corporation tax. Very Simple and very tax efficient.
Business Loan Protection
If your business has outstanding loans or mortgages a policy can be established to repay the outstanding balance if a shareholder(s) or Director(s) die or become critically ill. A business can be put under huge pressure in either of these events. This policy could mean the company is not saddled with debt if these circumstances transpire.
Shareholder Protection
What happens if a shareholder dies? Do the other partners have the liquidity to buyout the deceased partners family? Would the death of a key shareholder dramatically reduce the value of the business for the other shareholders? Would the family of the deceased shareholder wish to become involved in the business on a day-to-day basis?
If any of these questions, make you uncomfortable a shareholder protection policy can be established to protect value for all shareholders should one of the shareholders pass away.
Key Person Protection
SME’s often rely on a small number of highly effective or influential staff for the success of their business. A Key Person Protection insures against the death of critical illness or that individual. This can allow the business time and capital to reorganise, hire, recruit and to replace lost skills or revenue. A recent study by Legal and General found that 59% of business owners predicted they would have to stop trading within 12 months of the loss of a key individual.
A Pension Designed For Business Owners
What is a Small Self Administered Pension Scheme?
A Small Self-Administered Scheme (SSAS) offers several advantages for business owners. SSAS is a type of occupational pension scheme that is typically set up by small and medium-sized businesses, often with the business owners as trustees. Here are the key benefits:
Investment Flexibility
- Diverse Investment Options: SSAS allows investments in a wide range of assets, including commercial property, stocks and shares, bonds, and alternative investments.
- Property Purchase: Business owners can use SSAS to purchase commercial property, which can then be leased back to their business. Rent paid to the SSAS is tax-deductible for the company and tax-free within the scheme.
- Loan Back to the Business: SSAS can lend up to 50% of its net asset value back to the sponsoring business under strict terms, providing a potential source of funding.
Tax Benefits
- Tax-Free Growth: Investments within the SSAS grow free of capital gains tax and income tax.
- Tax-Deductible Contributions: Contributions made by the business to the SSAS are tax-deductible, reducing the company's taxable profits.
- Tax-Efficient Transfers: SSAS can receive transfers from other pension schemes, potentially consolidating and managing funds more efficiently.
Control and Customisation
- Trustee Control: As a trustee, the business owner has direct control over investment decisions, allowing for a tailored approach to managing retirement savings.
- Intergenerational Planning: SSAS permits multi-generational membership, enabling business owners to involve family members and plan for wealth succession.
Cost-Effective for Small Groups
- Shared Costs: A single SSAS can serve multiple members (often family members or company directors), which can be more cost-effective than setting up individual schemes for each person.
Retirement and Succession Planning
- Flexible Benefits: SSAS offers flexible retirement options, including phased retirement and tax-free lump sums.
- Inheritance Tax Benefits: Upon death, SSAS funds can usually be passed on to beneficiaries free of inheritance tax, allowing for efficient wealth transfer. This is likely to change in 2027 following the Autumn 24 budget.
Business Stability and Growth
- Liquidity Support: The loan-back facility can provide the business with liquidity during challenging times or for expansion opportunities.
- Asset Utilization: Using SSAS to purchase commercial property enables the business to operate from a property it effectively owns, potentially reducing overheads and ensuring stable premises.
Cautionary Considerations
While SSAS offers many advantages, it requires careful management and compliance with HMRC regulations. Mismanagement or non-compliance can lead to significant penalties. Professional advice is highly recommended when establishing and managing a SSAS.
Let’s Discuss Your Investment
At Carlile Alexander Private Wealth, we specialise in providing tailored wealth management strategies to business owners like you. Whether you're planning for a comfortable retirement, managing your wealth, or securing your business's future, our expert team provides bespoke solutions tailored to your needs.
Fill in the form below to schedule a complimentary consultation and start building a secure, prosperous future for your business and personal wealth. Let’s work together to turn your goals into reality.
Book a meeting with our experts today!
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Our Mission
It is to empower our clients with the knowledge, tools, and strategies to grow, protect, and transfer their wealth. We understand that every financial journey is unique, and we are committed to providing solutions that are as distinctive as the individuals we serve.
At Carlile Alexander Private Wealth, we are more than just your financial advisors; we are your partners in success, working closely with you to create a legacy that lasts for generations.
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From Our Monthly Commentary
Charting The Way – April 2025
Monthly Commentary – March 2025
