Lifetime succession planning

Produced by Tolley

The following Trusts and Inheritance Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Lifetime succession planning
  • Introduction
  • Passing down the shares
  • Company purchase of own shares
  • Use of trusts

Lifetime succession planning


Succession planning can be described as the development of prudent and considered strategies to help protect a business from unnecessary deterioration. Such deterioration could arise from (possibly) unexpected future events, eg the owner-manager’s forced retirement or serious illness.

Clearly, owner-managers should have a mechanism in place for passing over the management or ownership of their company over time. For most owner-managers, transferring the running or ownership of their business is a difficult and emotionally charged affair. However, owner-managers who fail to plan for succession do so at their peril since, in a worst-case scenario, this could lead to a collapse of the business.

There are many reasons why owner-managers are reluctant to hand over control, which include:

  1. fear of their own retirement

  2. the potential threat to their personal identity

  3. an inability to make a choice amongst their children

However, trend

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