Investors' Chronicle quotes Tabitha Collett and Edward Robinson on the uptick of interest in Family Investment Companies

With UK Chancellor Rachel Reeves’ spending review doing little to assuage fears over future tax rises, families are looking for new ways to protect their money.

Trusts used to be the default option for individuals wanting to reduce their inheritance
tax (IHT) liability when passing on wealth while retaining some control over their
gifted assets. However, the tightening of trust rules in recent years has meant interest in family investment companies (FICs) has grown.

Tabitha Collett, Senior Associate, in our Private Client team provides comment on the uptick for Investors' Chronicle:

Looking ahead, we expect momentum to grow post-April 2026, when business assets may for the first time be exposed to inheritance tax, with current 100 per cent relief potentially reducing to 50 per cent. That, alongside other relevant tax points (including the government’s commitment to cap corporation tax for the life of the parliament and the increase in capital gains tax for individuals), has made FICs more appealing and could further increase demand as families look for alternative structures to support inheritance tax planning.

Edward Robinson, Legal Director in our Corporate team also provides comment on the type of clients FICs suit:

FICs are an attractive and flexible alternative to trusts, particularly for entrepreneurial clients used to operating a corporate structure. Our entrepreneurial clients tell us that they find the corporate structure to be much more accessible to them than other holding structures.  Some clients are unfamiliar with trust arrangements, and the unique role of trustees, but are entirely comfortable with mechanics which involve shares and directors. For those who are most comfortable in a boardroom setting, they already speak the language of a FIC making it much easier for them to conceptualise the approach. 

The amount an individual wishes to transfer will also be an important factor when considering whether a FIC is suitable. While FICs were once the preserve of the ultra-wealthy, they have become an option that is “increasingly viable for those who are not ultra-high net worth”.

Read the full piece in Investors' Chronicle here.