Forum debates tax issues of family businesses

The issues surrounding tax efficient strategies for family-owned businesses were hotly debated at the recent Next Generation Family Business Forum co-hosted in Nottingham by Coutts Bank and specialist insurance, financial, risk management and corporate finance firm, The Wilson Organisation.

The latest in the series of Forum events heard from guest speaker David Baldwin, Partner and a third generation family member at Baldwins Accountants, about the personal challenges he has faced within the succession plan of the family business.

His overview of the position of share holding and options available within family firms struck a chord with guests at the Forum, all directors or managers within their family's business.

"Tax efficient strategies for individuals running a family business are an emotive subject, but an issue that can often be something of a double-edged sword - owners should carefully weigh-up the short term financial benefits of involving a spouse or partner in share options and ownership, against the long term personal issues should the relationship ever encounter difficulties," David Baldwin explained.

"It's a massive and often complex topic in which family business owners have to consider the financial cash benefits of tax-saving tactics alongside the practical impacts should things go wrong outside of the business. It's potentially a very difficult minefield to navigate."

Now in its second year, the Next Generation Family Business Forum is unique in the Midlands, and aims to bridge the gap between the theory of running a family business and the associated succession issues, whilst presenting the opportunity to share experiences and concerns. The unique challenges that come with running a family business were the inspiration behind Wilsons creating the Forum. Charlotte Prow, joint managing director of The Wilson Organisation with her sister Annabel, explains:

"I appreciate the real benefit of sharing experiences - working in a family business can sometimes be a lonely job and the Forum meetings have proved a good way to forge friendships and new business relationships. In the difficult economic conditions, family-run businesses have to maintain planning and communication throughout the organisation.

"David was an inspirational and highly interesting speaker at our most recent Forum," says Charlotte, "providing not only an account of the challenges he faced joining the family business and spearheading its growth strategy through organic expansion and acquisition, but also delivering an insight into his views on considerations surrounding share options for family members in a family-owned business, as a qualified accountant and Partner at one of the Midlands largest independent accountancy firms."

The Wilson Organisation, based in Nottingham, provides professional independent insurance, financial, risk management and corporate finance solutions to businesses and individuals both regionally and nationally. It is a Top 100 UK independent broker and has developed innovative solutions through strong relationships with insurers and financial services providers. For more information, visit: http://www.wilorg.co.uk, or Tel: 0115 942 0111.

Baldwins Accountants was established in 1971 and is now the Midlands largest independent accountancy firm with offices throughout area including Tamworth, Walsall, Stourbridge, Leamington Spa, Nuneaton and Ashby de la Zouch. David Baldwin was admitted to membership of the ACCA in 2002 and has worked for the firm for 12 years, being made a Partner in 2006. For more information, visit: www.baldwinsaccountants.co.uk.