Tax planning for retirement relief

Question asked:


A financial services company. The shareholding is as follows: SH1: 70% Full time employed, SH2: 15 % part time employed; SH3: 15% Part time employed.
In 5/6 years’ time SH1 wishes to retire. He has been employed on a full time basis for the last 10 years and is 53 years of age now. The company will be sold. The asset that will be sold will be goodwill which will be worth approx. 300k. The only other asset will be bank account with a projected value of 500k.
Problem: exposure to CGT on the bank account part. We believe to shelter by retirement relief.
Notes: SH1 is paying tax at top rate and has substantial pension pot.
It would suit other two partners to top up pension contributions. In fact it would suit other partners better to continue the business going as they are each earning in the region of 25k p.a. from the business and have annual rent of approx. 10k for the premises company operates from.
Please let up have your observations/comments

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Asked on 10 January 2019 10:13 am