TAX-EFFICIENT INVESTMENT STRUCTURING

Client Scenario

Our client is a dual UK/US citizen living with his family in the North-West of England. After building and selling a successful business, he wished to use his wealth and experience to work with early-stage businesses in the region.

Our Service 

We designed and implemented a bespoke investment structure built around the client’s key objectives:

  • To allow funds to be easily deployed into projects he identified as opportunities to add substantial economic and commercial value
  • To be flexible enough to allow other investments from friends and business associates from outside the UK
  • To be tax-efficient so as to be able to maximise the amount of capital being invested into these exciting and highly promising start-up and scale-up businesses

To achieve these goals, the structure we proposed was incorporated outside the UK to provide tax neutrality for other investors – in other words, the structure itself would be subject to a low tax rate but each individual would pay tax in their own country of residence (in our client’s case, the UK).

Given the client’s dual UK/US citizenship, it was vital for us to work with professional associates in the US to make sure our client would not be adversely impacted by our suggested structure. Due to our existing strong relationship with the US lawyers, the process of establishing the structure and making the necessary US tax elections was seamless.

Because of our client’s complex circumstances, he wanted a single point of contact with whom he could discuss all of his affairs. We therefore project managed all aspects of the work, bringing in external specialists where appropriate, and now continue to provide a full Private Office service to him and his family.

Outcome

International tax and cross-border structuring is inherently complex and requires a team with the knowledge and experience to provide a seamless service. The team at Lancaster Knox is drawn from a wide background, including the Big Four, Family Offices and HMRC, meaning our range of expertise is unparalleled within an independent firm.

Through our exceptional network of professional contacts in jurisdictions around the world, we are able to provide a comprehensive service irrespective of the size of any given project, and integrate ourselves seamlessly into our clients’ own teams.

Please note: this case study reflects the facts, circumstances and tax position at the time the project was undertaken. It has not been updated for any subsequent change in tax law or practice and must not be construed as advice, or otherwise relied upon for any purpose.

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