Procedure for unquoted share transfer (family business) on death

Procedure for unquoted share transfer (family...

Didn't find your answer?

My father recently passed away holding 1 share in the limited company that I manage and continue to run. I own the only other share i.e. we each owned 50% at his death. My Dad's involvement  in the company was minimal as company secretary. The market value of the company is <£100k. We discussed transferring his share to me a few months ago but didn't go that route due to the CGT liability he would incur.

My Dad's Will did not explicitly state what should happen to this share, so my mother now becomes the beneficiary, but she would like this share to transfer to me instead because she has sufficient other income and would like to avoid the hassle of self-assessment tax forms. I have read that the transfer can be achieved by a "deed of variation" to the Will signed by all affected parties. My question is this the easiest way and are there likely to be any IHT or CGT consequences I should be aware of? My understanding is that IHT should be unaffected as 100% BPR should apply and CGT should only apply on any subsequent disposal by me of the share. Is this correct?

I imagine this is not uncommon situation and would like to do this without involving a solicitor, so any help would be greatly appreciated.

Replies (2)

Please login or register to join the discussion.

By johngroganjga
13th Jul 2014 15:02

I will comment on your last sentence first. You would be very ill advised to consider drafting and executing a deed of variation by yourself without involving a solicitor.

But yes a deed of variation would be the text book way to achieve what you want. The alternative would be for your mother to gift the share to you as soon as it is transferred to her by the executor. That would be simpler but the CGT and IHT consequences would be different.

Thanks (0)
Replying to johnt27:
avatar
By YoungBob
14th Jul 2014 14:41

It is because of the different IHT consequences that I would rather it wasn't gifted from my mother so I'll look into what is required to draw up the deed of variation. Thanks for the advice.

Thanks (0)