Thoughts on purchasing property in a company

[islandgirl]

A relative of ours has purchased property in a company giving shares to her kids having been advised that this is a way to assist with the inheritance tax burden. We may soon be buying a property (self and Mr Islandgirl) - does this work? What are the pitfalls? Anyone any ideas please!

[atticus]

Cunning plans need specialist advice.

[PallasAthena]

Sounds like a Family Investment Company. A search should bring lots of explanations about how they work. Sites I've seen suggest you'd need to be buying a large property for it to be financially worthwhile. Like £2 million+

No-one should set up an FIC without professional advice.

[Tofros]

Remember that if the children are minors they cannot legally hold shares.

[islandgirl]

Thank you all - I would of course take detailed legal advice just trying to get views from my educated colleagues here. Kids are over 18. Property nowhere near £2 million! I love the idea that I am hatching a "cunning plan" but it seems to be fairly mainstream - a relative has done it. Yes it would be FIC I suppose. Decisions to make before contracts will be signed and advice to obtain - thanks again

[Frank1]

There is an informative article titled "Family investment companies-how they work" at www.bdo.co.uk
Particularly under the heading
"Pros v Cons and is a FIC right for your family?"

For the lucky peeps with a large income and the likelihood of a big IHT when they pass on, they should consider relocating to the Isle of Man That's if they don't mind motorbikes racing around the streets