It is said “every cloud has a silver lining” and this is true in today’s economy. While the news is full of doom and gloom, we should look on the bright side and consider what opportunities we can grasp.
Hopefully, your business has prospered over the last number of years and you have a more valuable asset along with some additional property, capital, or cash. The question is can you do anything to take advantage of the current climate, either now or in the long-term?
Opportunities to consider might include:
Given that the valuation of stocks, properties, and businesses is now considered low, perhaps now is a good time to buy/invest? If you already have assets, the valuation of which has decreased, it might be possible to obtain a tax advantage.
Transferring wealth to children
This is sometimes very costly in terms of inheritance tax implications. However, given that property, shares, and business valuations are low, now is an ideal time to pass these on to the next generation. The exposure for tax is automatically reduced because of the reduced valuations, and in many cases there are other tax reliefs available.
Every business should take the opportunity to tighten its belt and cut out inefficiency to strengthen the business for the return to growth.
Business expansion scheme (BES )
Raising bank finance is difficult. Depending on your trade type, it might be possible to raise finance through equity holdings in the form of BES, whereby shareholders might be able to obtain tax relief on their investment in your business.
These investments are always attractive and carry valuable tax relief. In addition, now is an appropriate time as your pension scheme is investing in markets at a currently low level, therefore the potential for an increase in wealth is greater.
If you have been trading over the last number of years through companies and they now contain significant wealth, extracting this wealth into your own personal names can be costly in terms of taxes and perhaps now is the right time to look at a restructure.
A recent change in tax legislation means that it is now easier to tidy up group structures which could be done in conjunction with extracting more wealth.
The legislation governing research and patents has been relaxed somewhat and it is an ideal time to establish if there is any part or process in the trade that would satisfy the criteria, thereby obtaining very valuable tax relief.
This refers to the Mid-Shannon Corridor area and provides for significant tax relief for investments in tourist-type ventures. This should be considered as an opportunity for those wishing to expand or commence trading within this region.
Protection of assets
There are many means in which this can be achieved through distributions, restructuring, non-disclosure of information, etc.
Given the changing economy and personal lifestyles, every individual should review their personal life assurance, PHI, etc, to ensure they have sufficient and appropriate cover in place.
For more information, please contact Mairead O’Grady on (090 ) 6480600 or [email protected].