Journal :: FURBS ? Buy Now While Stocks Last

Published: July 26, 2005
Author: Graham Dragon
Category: Tax
Permalink: FURBS ? Buy Now While Stocks Last

In April 2006 it will no longer be possible to make a contribution to a FURBS and obtain the same tax benefits you can obtain today.

Tax benefits? I hear some of you ask, ?what benefits??

Well, for example the ability of a higher rate taxpayer to receive dividends without paying any further tax on them. The ability to pass vast sums outside your estate for Inheritance Tax purposes but still effectively have access. The ability to extract cash from the Company and obtain tax free growth. And in certain circumstances the ability to avoid large Capital Gains Tax bills on a property development. Need I continue?

But from April 2006 the rules are changing radically. So radically that HMRC think the FURBS is dead. They are wrong, though. It is alive and kicking ? it has just morphed into another vehicle entirely. One which could provide a tax efficient method of avoiding a ?taint? of the business taper relief on shares in a trading company. One which could still allow a tax efficient extraction of Company profits. And one which, properly utilised, could still be a very IHT friendly vehicle.

Nevertheless, it is very important that clients who may wish to take advantage of a pre A-Day FURBS set one up now ? even if they only set it up with a nominal investment. There are certainly ways in which those clients will then be able to continue to take advantage of the pre A-Day rules with that FURBS even after those rules all change.

And it is important to understand how you can use the new, post A-Day FURBS. The vehicle everyone else seems to think has died ? just as they did when the Revenue started claiming National Insurance on the contributions (even though it is commonly believed the Revenue stance is actually contrary to a High Court decision in May 2000).

One of the ideas I will be presenting in my ?6 More Ideas to Excite Your Corporate Clients? on 10th August will show you how your clients can use a combination of a pre and post A-Day FURBS ? and a way you can explain the benefits to a client without that client?s eyes glazing over. And as the name of the day suggests, there will be another five different exciting ideas on that day too ? ideas that should excite your clients and earn you more money.

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About Graham Dragon

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