The company’s shares are not traded on a recognised stock exchange and this has certain tax implications. Independent professional advice should be obtained when considering any share transfer. Set out below is our broad understanding of the position based on UK tax July 2018.

Inheritance Tax

100% business property relief should be available and no tax is payable in respect of shares owned by the deceased at the date of death or on the value of any lifetime gifts of the company’s shares made in the seven years before the date of death.

Capital Gains tax

Where lifetime gifts of shares are being contemplated consideration should be given to making a hold-over election for Capital Gains Tax purposes.

Depending upon the circumstances, it could result in a deferral of CGT otherwise payable by a donor or an increase in the acquisition value for the donee where an unusable loss would otherwise arise.

Income Tax

The company is controlled by less than 5 persons and is a Close Company for tax purposes. For most shareholders this is of no practical consequence.