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Family Investment Company Services

Family Investment Company Services

Build, Protect & Pass On Wealth On Your Terms

A Family Investment Company (FIC) is a powerful, flexible vehicle for preserving wealth across generations. By using an FIC, families can efficiently preserve, accumulate, and transfer family wealth, ensuring assets are protected and passed on to future generations in a tax efficient manner. At HeirPlan, we help families establish and manage FICs that align with long term goals, tax planning, and governance requirements.

What Is a Family Investment Company?

A Family Investment Company is a private company (often a limited company) created to hold family investments  such as property, shares, cash, private equity, or other assets under a corporate structure. Shareholders (typically family members) own shares and benefit from dividend payments, as the company may pay dividends to distribute profits to shareholders, while the company retains control over the underlying assets and investment strategy.

Because the structure is corporate rather than trust based, it offers distinct advantages in tax planning, control, legacy, and flexibility.

Dividends received by the FIC are generally tax free, but dividend payments made to shareholders may have different tax implications depending on individual circumstances.

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    Why Use an FIC?

    • Control & Governance
      Directors (often family members or trusted advisors) maintain strategic control over investments, safeguarding against mismanagement or asset stripping.
    • Tax Efficiency
      An FIC offers significant tax advantages and tax savings by allowing profits to be taxed at the corporation tax rate, which is often lower than personal tax rates. The applicable corporation tax rates depend on the company’s annual profits: profits below £50,000 are taxed at the small profits rate, profits above £250,000 at the main rate, and profits between these thresholds benefit from marginal relief provisions to smooth the transition between rates. However, double taxation can occur when profits are taxed at the company level and again when distributed to shareholders as dividends. Retention of income and capital gains planning within the FIC can further enhance tax efficiency compared to direct holdings.
    • Succession Flexibility
      Shares can be gifted or sold to younger generations in stages, enabling a gradual transfer of ownership without disrupting investment continuity.
    • Asset Protection
      Investments held by the company are sheltered from individual claims or disputes, providing an additional layer of protection.
    • Wealth Consolidation
      A single vehicle to hold diverse assets  investments, businesses, property simplifying reporting and governance.
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    Our FIC Service Offering

    Family investment companies (FICs) are a strategic tool for wealth management and tax planning, offering families a tax efficient manner to control, grow, and transfer wealth across generations.

    1. Feasibility & Structuring

    • Review family goals, current asset mix, tax position, and timing, including the types of investment assets and income generating assets to be held.
    • Assess the process to transfer assets or transferring assets into the FIC, considering the costs involved, tax implications, tax consequences, immediate tax consequences, and further tax, such as capital gains tax, stamp duty, and inheritance tax.
    • Decide on share classes, governance provisions, capital vs income distinction, and the involvement of each family member and other family members.
    • Distinguish between a trading company and an investment company, considering the relevance of business property relief, substantial shareholdings exemption, and the impact of close investment holding companies.
    • Compare FIC against alternatives (trusts, partnerships, direct ownership).

    2. Company Formation & Documentation

    • Draft Articles of Association tailored to family dynamics.
    • Prepare a shareholders agreement, director service agreements, and subscription documents to define control, dividend policy, and shareholder rights.
    • Formalize capital structure, share issuance, and initial capitalization.
    • Register the company with Companies House, considering the option of unlimited companies and their distinct reporting requirements.

    3. Tax Planning & Optimization

    • Advise on corporation tax, withholding taxes, dividend policy, capital gains treatment, and the need to pay corporation tax on profits.
    • Coordinate with tax advisors to optimize family level exposures, including income tax, dividend tax, taxable income, personal income, dividends paid, dividend income, and tax payable.
    • Implement strategies to claim tax relief, corporation tax relief, corporation tax deduction, obtain tax relief, and loan interest deductions, including the deductibility of investment managers fees and mortgage interest.
    • Utilize tax efficient investment vehicles such as the enterprise investment scheme.
    • Structure loans to allow capital to be repaid tax free where appropriate.
    • Advise on tax purposes, pay tax obligations, and the impact of close investment holding companies on tax rates and reliefs.

    4. Governance, Compliance & Administration

    • Assist with board meetings, resolutions, and record keeping.
    • Prepare and file annual accounts and corporation tax returns with Companies House to meet statutory and regulatory requirements.
    • Advise on compliance obligations, reporting, anti money laundering (AML), and regulatory updates.

    5. Succession & Exit Strategies

    • Plan phased transfers of shares via gifts, sales, or wealth restructuring, considering inheritance tax planning, inheritance tax, inheritance tax purposes, and inheritance tax liabilities.
    • Structure gifts as potentially exempt transfers (PETs), ensuring the donor survives seven years for the assets to fall outside the donor’s estate for inheritance tax purposes.
    • Consider the use of discretionary trusts and the involvement of other family members in succession planning.
    • Evaluate exit or winding up options when appropriate.
    • Coordinate with wills, trusts, and estate planning to ensure holistic legacy planning.

    6. Ongoing Support & Review

    • Regular checkups on structure efficiency, tax changes, or family circumstances.
    • Adjust governance, funding, or strategies as circumstances evolve.
    • Provide value added advice on new investment opportunities.
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    Who Benefits From Family Investment Companies?

    Our FIC services are ideal for families looking to pass on wealth in a tax efficient manner:

    • High-net-worth families seeking intergenerational wealth and inheritance tax planning
    • Owners of significant investment portfolios (public, private, real estate) who wish to hold investment assets within the FIC
    • Family business owners wanting to separate control from beneficial ownership and distribute wealth to other family members
    • Trustees and fiduciaries seeking alternative structures to trusts
    • Families wishing to retain control while passing wealth thoughtfully
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    Key Inheritance Tax Considerations & Questions

    • Is an FIC better than a trust? : FICs offer corporate control, dividend flexibility, and clear governance, while trusts provide legal safeguards and beneficial interest separation. The right choice depends on family objectives, tax positions, and interpersonal dynamics.
    • How to structure share classes? : Multiple classes (e.g. income vs growth, voting vs non-voting) can be tailored to balance control and benefit among family members.
    • What about liquidity? : Plan for funding (cash, property contributions) and exits (dividends, sale of shares) to maintain liquidity for tax or personal needs.
    • Tax Risks & Compliance : Complex rules around “settlement” (anti-avoidance), transfer pricing, dividend taxation, and exit charges must be handled carefully.

    Why Choose Us?

    • Holistic & Bespoke Solutions: We design FICs around your family’s goals, relationships, and financial footprint.
    • Interdisciplinary Expertise: We work closely with tax advisors, investment managers, legal counsel, and accountants to deliver integrated solutions.
    • Transparent Communication: We explain complexities clearly, so family members and future generations understand the structure.
    • Long-Term Partnership: We support your FIC through market cycles, tax changes, and evolving family dynamics.

    Start Your FIC Journey

    1. Initial Consultation – Explore whether an FIC is right for your family
    2. Strategy Assessment – Review assets, structure needs, and tax position
    3. Design & Implementation – Incorporate, document, and fund the company
    4. Ongoing Governance & Review – Ensure the structure remains aligned with goals

    Get in touch with us today to begin structuring a Family Investment Company tailored to your family’s future.

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    Expert Guidance for High Net Worth Individuals

    1
    Comprehensive Wealth Analysis

    A detailed review of your global assets, liabilities, and family objectives ensures every element of your estate is structured to minimise tax and protect wealth.

    2
    Advanced Tax Mitigation Strategies

    Utilising trusts, Family Investment Companies, and lifetime gifting, we help reduce exposure to Inheritance Tax (IHT), Capital Gains Tax, and other UK and international taxes.

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    3
    Tailored Succession Planning

    Custom plans ensure seamless wealth transfer to the next generation, balancing fairness, family dynamics, and long-term financial security.

    4
    Asset Protection & Risk Management

    Strategies such as Asset Protection Trusts safeguard property and investments from creditors, divorce settlements, and market volatility.

    5
    Global Estate Coordination

    For clients with cross-border assets, we provide integrated planning to manage multi-jurisdictional tax laws and ensure compliance worldwide.