Jacob and Julie Rundle

Julie Rundle and her son Jacob were looking for a favourable property investment tax strategy for investing Julie’s savings, hoping to achieve three main outcomes:

• To provide a vehicle for investing her funds at a higher return than the minimal interest rate they were currently achieving
• To provide an income that would offset the currently high mortgage interest rates
• To create a legacy, ring-fence the wealth and mitigate inheritance tax for her two grown-up children

The Situation and Goals

Property investors already, Julie and Jacob favoured less traditional asset classes. They were keen to understand what different asset classes could be available to them, via different tax and investment products and strategies. In addition, Julie had a lump sum sat waiting to invest in assets that would achieve more for her than the current minimal gains they were currently receiving.

For Julie, an income from her investments was key, to offset the current interest charges. Equally important was the ability to protect the assets for her son and daughter. A property investment tax strategy was needed.

”We didn’t know anything about the Family Investment Company, but Lewis explained it well. We’ve had financial advisors in the past but they didn’t mention anything about it.”

Jacob and Julie had already spent some time speaking to various financial advisors and looking at suitable products. However, the search was not proving fruitful until Julie’s partner suggested speaking to TLPI. His relationship with TLPI was related to pensions, but as he was aware that TLPI offer tax planning and strategy advice, suggested Jacob made contact.

After an initial phone conversation, it became clear that a Family Investment Company was the ideal route for Julie’s funds, with a FIC looking the ideal product to answer their questions:

• Can the strategy provide my mother with an income?
• Is there potential to achieve higher rates than I am achieving at the moment?
• Will this provide a solution to reducing inheritance tax and protecting assets for the family?

The Approach

Planning ahead

A free consultation takes place to understand your situation. What are you trying to achieve? How TLPI can help? The next step is to discuss the strategies and understand the products. If the options apply, then TLPI can help establish your bespoke plan.

Jacob explained: “I remember speaking to our consultant Lewis. He explained the great many asset classes that were available, and that we could choose which to invest in using our FIC.”

Jacob and Julie started to explore options that they had not previously considered. TLPI showed many different options available to them.

Jacob went on to say, “it was clear that the FIC had a fit for everybody in some way. There was more scope!”

“We already have a couple of buy-to-lets in our personal name, which will remain in the estate, but we plan to buy more through the FIC. We just didn’t want to buy them and add to the problem of a growing bigger tax burden. If we had seen the FIC earlier, we would be in an even better position…….but that’s the past, can’t change it!”

Julie’s goals were achievable: offsetting the mortgage interest rate increases and Section 24 mortgage tax relief cuts. Providing an income and ring-fencing future assets. For Jacob and his sister, this gives peace of mind. Julie can continue to afford the existing buy-to-let mortgages. Inheritance Tax avoided. The family’s legacy protected.

Working with our clients, we aim to:

• Understand their personal situation
• Apply expertise and knowledge of over one thousand tax benefits and subsidies available to company directors
• Provide the knowledge and understanding needed to make informed decisions about ALL their wealth assets and options
• Apply 360° strategies to mitigate tax liability
• Achieve the control and flexibility required to leverage current wealth to grow the business and assets
• Free up time, by consolidating the many areas of the business and personal financial situation into one strategy for optimising tax and growth

Who? 

Julie’s partner recommended TLPI. Knowing we offer immediate access to an expert consultant in property investment and tax planning. Perfect for Julie, who was struggling to decide which approach would solve her problems. 

A consultation with TLPI allowed a full picture of the options. Julie, her son and daughter were all able to take part. Questions pertinent to all parties could be answered. Family strategy for now and for the future was planned openly.  

Why? 

The Family Investment Company was the direction the conversation took. When Julie and Jacob approached TLPI in search of a tax planning. Having already had the recommendation from Julie’s partner, plus conducting due diligence themselves. It became obvious for the family to start their Family Investment Company with TLPI. 

How? 

Experience of property investment, made Julie and Jacob see the benefits of buying via a Family Investment Company. Changes in legislation restricted income from property. Inheritance Tax implications were already vast and set to increase! It was essential they create a tax efficient wrapper before investing further. 

A Family Investment Company makes your children beneficiaries of assets held within, Inheritance Tax free. 

The flexibility of the Family Investment Company means that Julie is in control of the company and assets. Investments to grow the portfolio will now be protected. Overall, the tax situation is optimised. 

The Result 

The property investment tax strategy is established 

Julie and her family are now able to seriously consider their future investments. The tax implications of each purchase made clear. 

They have a greater understanding of both their tax position and the landscape. As a family, the ring-fenced plan has future-proofed the legacy. For Julie, she has the added security of mitigating her own tax position. Now, Julie has increased rates on her existing and future properties. 

Julie and Jacob invest in property. But now, they a greater understanding and support of a dedicated consultant. They are now able to make informed choices. They plan on investigating further buy-to-let purchases. Hands-off property investment has also become a focus. 

Summary 

TLPI aims to understand the individual situation of all our clients. Each situation is different requiring a bespoke approach and ultimate solution. Julie and Jacob had a little knowledge and some experience investing in property but wanted to increase their understanding, especially about the tax implications.  

Our Process 

First an initial call, Julie decided if the products TLPI offers might fit her situation. Following that, an in-depth consultation, to delve deeper. Only after these initial consultations, Julie and Jacob felt comfortable with a Family Investment Company.   

For others looking at investment tax planning, Jacob notes: 

“There is really not that much information available, so people are not aware of the tax planning solutions available – it’s not something that is common knowledge. We haven’t had our FIC long, but would recommend that anyone who has a chunk of money they want to grow tax efficiently and hold outside the estate, should make enquiries and learn more about whether the product could help them save tax and protect their family from a big Inheritance Tax bill.” 

Our Experts 

At TLPI our consultants are experienced in property, investment tax planning, and pensions. We are registered with HMRC to set up Family Investment Companies and SSAS pensions. Thank you to Julie and Jacob for sharing his Family Investment Company story. 

Our Aims 

Our aim is to provide learning content that illustrates powerful tax planning vehicles and strategies used in conjunction with the Family Investment Company. TLPI’s aim is always to understand your personal situation and provide advice and support that fits around your aims and goals. 

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