A company restructure could be the game changer you need

A company has been able to make a £55,000 annual tax saving thanks to the right advice on a restructure.

Company restructuring is not only about remaining compliant: it can also unlock smarter ways of achieving real, tangible results.

One recent client success story from Chadwick Accountants & Bookkeepers in Bidford-on-Avon highlights how the right advice can transform the way directors manage their tax position, and generate long-term savings.

Rachael Chadwick-Harrison, Managing Director of Chadwick’s, explained: “Our client, a successful limited company with three directors, had built up a profitable and growing business. However, their existing company structure meant that their personal tax liabilities were significantly higher than necessary. Despite working hard and running an efficient operation, the directors found a substantial proportion of their profits going straight into tax, limiting the flexibility they had in how they managed income and reinvested in their future.”

After a detailed review of their company structure, however, Chadwick’s identified that a restructure could deliver major longterm benefits. The key recommendations included:

Introducing wives as non-voting shareholders: this allowed income to be distributed more efficiently among family members without diluting the directors’ control over the company

• Maintaining full director control: by ensuring that new shares were nonvoting, the directors kept complete decision-making authority

Tax planning for the future: Chadwick’s modelled the potential tax savings, not just for the current year, but also projected forward to show the cumulative impact.

The restructure had a transformational impact. Collectively, the three directors have reduced their personal tax liabilities by £55,272 every year going forward, representing a huge annual saving that compounds year after year, more take-home income for the directors and their families, and the ability to reinvest savings into the business or personal financial goals. directors not only have greater financial flexibility, but the peace of mind that their affairs are structured in the most efficient way.”

“For the client,” said Rachael, “the outcome has been game-changing. They now benefit from a more tax-efficient structure while retaining full control of their company.