An FIC offers more control over investments than a trust while still allowing for tax-efficient wealth transfer. Trusts are often limited by time and regulations, while FICs can be adjusted as needed.
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Family Investment Companies: A Smarter Way to Protect and Grow Your Family Wealth
We help you structure, protect, and grow your family’s wealth—today and for generations to come.
Preserve your family’s future with a Family Investment Company (FIC)
At Mural Crown, we understand that managing family wealth is about more than just numbers—it’s about ensuring stability, protecting your legacy, and planning for the future. A Family Investment Company (FIC) offers a practical, tax-efficient structure to consolidate investments, streamline generational wealth transfer, and maintain family cohesion.
What is a Family Investment Company (FIC)?
A Family Investment Company (FIC) is a corporate structure designed to help families manage and protect their wealth across generations. It serves as a vehicle for investing in multiple assets while offering significant tax advantages, including reductions in Higher Rate Income Tax, Capital Gains Tax (CGT), and Inheritance Tax (IHT).
With an FIC, family members become shareholders, and the company itself owns the investments. This structure provides a unique blend of control, flexibility, and efficiency, making it an attractive option for families with significant wealth.
Key Features of an FIC
Control: Senior family members can retain control over decision-making by holding voting shares, even as ownership is passed to younger generations.
Tax Efficiency: Investments grow under corporation tax rates, which are generally lower than personal income tax rates. Inheritance planning strategies can further reduce IHT exposure.
Flexibility: FICs can be tailored to fit your family’s investment objectives and adjusted over time to respond to market conditions or changes in family circumstances.
How Does a Family Investment Company Work?
An FIC operates as a limited company with shares allocated to family members. Parents or senior members usually retain voting shares to manage the company, while younger family members hold non-voting shares, allowing them to benefit from future growth without direct control.
Example FIC Structure
Parents: Hold voting shares to control decisions.
Children/Grandchildren: Hold growth shares, allowing them to inherit wealth incrementally while avoiding inheritance tax during their parents' lifetime.
Assets Owned by the FIC: These may include stocks, property portfolios, or other investments, managed centrally under one structure.
By using methods like alphabet shares and estate freezing, families can control wealth transfer, ensure stability, and limit tax exposure.
Key Benefits of a Family Investment Company
01
Tax Efficiency
FICs are structured to minimise tax liabilities, offering significant advantages over personal ownership or traditional trusts. Corporation tax is applied to profits, which can be more favourable than individual income tax rates. Inheritance tax planning can also be incorporated to pass on wealth without unnecessary tax burdens.
02
Maintaining Control
With an FIC, senior family members can retain voting rights while transferring shares to younger generations. This ensures experienced decision-making while still engaging the family in wealth management.
03
Unified Investments
An FIC centralises family investments under one corporate entity. This streamlines management, reduces administrative complexity, and enables a cohesive investment strategy aligned with shared goals.
04
Long-Term Wealth Planning
An FIC ensures wealth is preserved for future generations. By clearly defining ownership and governance structures, families can avoid conflicts and maintain harmony.
Is a Family Investment Company Right for You?
An FIC might be the right choice if your family:
Wants to manage significant wealth efficiently.
Is concerned about inheritance tax and succession planning.
Seeks to centralise and align investment strategies.
Desires a clear governance structure to avoid family disputes.
At Mural Crown, we assess your unique needs to determine if an FIC is the best solution for your family’s circumstances.
How Does a Family Investment Company Work in Practice?
A Family Investment Company (FIC) is a flexible and efficient structure designed to meet a family’s wealth management and succession planning needs. Here’s a step-by-step look at how an FIC operates:
Initial FIC setup
Share allocation: Senior family members (such as parents) typically retain voting shares, giving them control over decisions. Non-voting shares may be allocated to children or other family members, allowing them to benefit from the company’s growth without influencing day-to-day management.
Defining Roles and Governance: Decision-making roles are formalised, often with a board of directors or a family council. Governance rules are documented to prevent conflicts and ensure alignment on the company’s purpose.
Transferring Assets: Investments such as property, shares, or other financial assets are transferred into the FIC. These become part of the company’s portfolio, centralising wealth under one entity.
Ongoing company management
Decision-Making: The board of directors or designated decision-makers manage the FIC’s investment portfolio, ensuring alignment with the family’s objectives.
Dividend Payments: Profits generated by the FIC can be distributed to shareholders as dividends. This allows family members to receive income based on their shareholdings while optimising tax efficiency.
Adjusting Strategies: Over time, investment strategies are reviewed and adapted based on market conditions, family needs, or legal changes. This flexibility ensures the FIC remains relevant and effective.
How We Help You Set Up an FIC
Understand your goals
We start by getting to know your family’s financial situation, objectives, and priorities to create a structure that works for everyone involved.
Tailored planning
Our team collaborates with tax and legal experts to design an FIC that fits your needs, covering everything from investment strategy to governance.
Setting up the FIC
We take care of the practicalities, including registering the company and preparing legal documents, ensuring everything meets regulatory requirements.
Ongoing support
After your FIC is up and running, we provide ongoing advice to help it evolve with changes in your family’s needs, market conditions, or legislation.
FAQs About Family Investment Companies
Costs vary depending on the complexity of the structure. We provide a clear breakdown during our initial consultation.
It would be unwise to set up an FIC without taking the proper advice. These are complicated structures and should be created correctly to achieve maximum benefit. Firstly consult a specialist in the sector. Their knowledge and experience will be invaluable.
A Family Investment Company (FIC) provides flexible options to reduce Inheritance Tax (IHT). Using strategies like alphabet shares, estate freezing, and tailored share classes (such as freezer and growth shares), families can manage how wealth is transferred across generations.
The structure can also be strengthened by incorporating tools like Employee Benefits Trusts, Family Asset Protection Trusts, and Private Trust Companies (PTCs). When used effectively, these strategies can significantly reduce or even eliminate IHT liability, all while keeping control of family assets.
Yes, FICs can be scaled to suit families of any size, provided there’s a need for structured wealth management.
Ready to Secure Your Family’s Financial Future?
Contact us for a FREE 30-minute consultation to discover how a Family Investment Company can help your family build wealth, protect assets, and create a succession plan for generations to come.
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