Growth and Succession Planning for 2025

Recent budget announcements have signalled potential changes that could significantly impact business ownership and transfer. For local entrepreneurs, this underscores the need for proactive, strategic planning to protect their life's work and ensure business continuity.

If you have been running a family business for a number of years, it is only natural to want to pass it on to the next generation in a way that minimises the tax burden on beneficiaries, for instance.

With careful planning and professional guidance, business owners can manage inheritance and capital gains tax (CGT) implications when transferring ownership. Hassans, a full-service law firm specialising in international business law, emphasise that strategic ownership transfer planning is essential for long-term success. The processes of restructuring and transferring, whether in the UK or a British territory like Gibraltar (its main area of operation) can involve a number of complex hurdles.

Key Considerations for Sussex Business Owners

The complexity of succession planning extends beyond the simple transfer of assets. Business owners must navigate:

1. Tax efficiency: Current UK legislation offers significant advantages for businesses qualifying for Business Property Relief. This can mean transferring business assets without inheritance tax on death, with capital gains tax (CGT) effectively out of the equation.
    

2. Flexible ownership structures: Family trusts provide a sophisticated approach to business transfer. They offer multiple benefits, including:

• Protection of assets during potential personal financial challenges

• Retained control through trustee arrangements

• Flexibility in defining future beneficiaries
   

3. International considerations: For businesses with international operations, understanding local and international legal frameworks is crucial. As Hassans notes, entities like foundations can provide unique legal structures for complex business transfers.

Strategic Planning Steps

1. Consult with professional tax and legal advisors who understand your specific business context.

2. Explore tax-efficient transfer mechanisms.

3. Consider both immediate and long-term family and business needs.

4. Remain adaptable to potential legislative changes

Of course, ultimately, decisions about your succession planning need to be personal as they reflect a business and situation that you understand best. Nevertheless, it is always advisable to seek professional advice. Work with a local specialist who has specific experience carrying out succession tax planning for businesses similar to yours.

The Sussex Chamber of Commerce encourages local businesses to start conversations around succession planning early. In an era of economic uncertainty, those who plan ahead will be best positioned to preserve and grow their business legacy. The most successful business transitions are those planned well in advance, with clear communication and professional guidance.