Cash In the Business

Mr & Mrs M own a manufacturing company. Between them they have 100% of the shares, in addition to which there is one other director.  Mr M was starting to think about retiring, and his accountant suggested he speak to Stuart.

The business had been reasonably successful over the years, resulting in Mr & Mrs M building up significant cash balances in the firm’s accounts.  They had not previously done much with this, preferring to keep it accessible ‘just in case’ it was ever needed.  They finally conceded to their accountant that they were never going to need the majority of this, and they wanted to know what they needed to think about now in order to prepare for this.

Working with their accountant, Stuart put together a financial plan which ultimately will transfer funds from the limited company to their personal names, save them a lot of corporation tax and, most importantly, constructed a tax-efficient income stream that will allow them enjoy their retirement.  The net effect has also been that they can, if they wish, retire sooner than they had planned, as well as knowing they can do so without being forced to sell the business to produce the capital they will need.