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If you’re looking to pass on wealth to children or grandchildren in a controlled way, you may want to consider a Family Investment Company (FIC).
They’re usually suited to high-net-worth individuals who want to retain oversight of investment decisions and distributions. Families seeking an alternative to trusts may also want to explore an FIC.
A FIC is a private limited company used to hold and manage family wealth, typically cash, property or investments. They may offer tax efficiencies in areas such as Inheritance Tax (IHT) planning, Corporation Tax, asset protection and Capital Gains Tax (CGT) deferral. However, they can be complex, and differences compared to trusts mean that early professional advice is usually beneficial.
Kirk Rice’s tax and financial planning specialists provide advice on Family Investment Companies (FIC), including:
If you are considering a Family Investment Company as part of your estate or succession planning, please contact info@kirkrice.co.uk
FICs are generally most appropriate for high-net-worth individuals who want to pass wealth to children or grandchildren in a controlled and tax-efficient way.
They are also attractive to families looking for an alternative to trusts but who still value the ability to guide investment decisions and distributions over the long term.
Trusts remain useful in some circumstances, but they carry disadvantages such as higher rates of income tax and capital gains tax on retained income and gains, as well as potential upfront inheritance tax charges when transferring significant sums.
An FIC can also offer more flexibility and lower rates of tax on retained profits. Unlike trusts, FICs do not incur an upfront 20% IHT charge, and there’s no cap on how much can be transferred. However, the trade-off is additional company administration, and extracting profits may create a double layer of taxation — once in the company and again on the individual.
At Kirk Rice, our tax and financial planning specialists have been advising families since 1989. We:
If you’re considering a Family Investment Company as part of your estate or succession planning, our team can help you assess the options. Contact us at info@kirkrice.co.uk
Watch Boyes Turner & Kirk Rice’s experts discuss how Family Investment Companies (FIC) may be a tax-efficient tool for wealth preservation, generational planning, and mitigating inheritance tax in the UK.
Meet our experts.
Richard Somerville Partner - Tax
Thames Valley
View our frequently asked questions about family investment companies.
