02 March 2006
My 80-year old client is about to sell his successful trading company for £2 million. Although some of the proceeds will go to his family (20%), and trusts (14%), he and his wife will receive 66%, all of which will potentially add to his, already considerable, inheritance tax liability. While they own the shares they get 100% relief, but as soon as these are converted to cash it becomes 100% chargeable. They do not desperately need the money and the obvious thing is to invest it in furnished holiday lets to retain the inheritance tax relief.
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