Man in the courtyard of Rothschild & Co New Court offiec

Wealth Management for Entrepreneurs

We have a strong reputation and a very good relationship with entrepreneurs who are going through a process of selling their business.”

Client Adviser Katharine Taylor

Fortune favours those who are prepared

Both courage and caution are needed to forge your own fortune. Too often entrepreneurs neglect their personal finances in pursuit of business growth. But it's never too early to seek the right advice - whether you're planning what to do with the proceeds of sale or need a nest egg while your business grows. 

The entrepreneurial journey encompasses many opportune moments where decisive action can make a dramatic difference to business and personal outcomes.

Preparedness and partnering with the right experts can make the journey that much smoother - and more impactful.

Selling a business: Personal considerations

Planning your personal finances pre-sale and post-sale

Pushing out matters of personal wealth to the post-sale period may have financial implications when it comes to decisions about dividing business and personal assets, tax planning and charitable donations. So it makes sense to optimise certain entry points before, during and after business sale. We've outlined some key moments below.

1. Pre-exit

Partnering with an adviser early on can help you avoid common costly structuring, planning and taxation pitfalls and preparing early for future spending is preferable to waiting until you secure your cash post-sale. You might also like to prepare family, friends and dependents ahead of the sale, as public disclosure may require sensitivity and discretion. 

2. Point of sale

Securing cash from day one is not as straightforward as it seems. Firstly, you'll need to consider matters of liquidity and security, opening the right accounts in advance. Then there's the question of what to do with your wealth - with life-changing consequences. So it's best to wait a while before you take any long-term, irreversible decisions. 

3. Post-sale

As you look forward, it helps to divide your assets into 'pots' with varying degrees of risk and return - from cash and tangible assets like a family home or jewellery, to riskier growth assets, such as remaining business interests. You'll also want to plan how much to place in a 'nest egg' and consider how you might fund your future lifestyle. 

4. Investing

Investment decisions post-sale are critical when it comes to protecting your hard-earned wealth for generations to come. You'll want inflation-beating returns over the long term.

Business women considering charts and graphs before making a business deal

Pre-exit entrepreneurs hub

Whether you’re growing your business or are ready to sell, it’s never too early to prepare both your personal and business finances. We can support you before, during and after a sale.

Find out more

Selling a business: corporate considerations

Partnering personal with corporate advice

The market environment, the nature of the business, and your personal and professional objectives are key factors in your decision to sell, so you'll want a strong personal advisory team alongside your corporate one. We work closely with our Global Advisory division and Arrowpoint Advisory to champion your personal interests, while your corporate team can focus on your business. 

It’s crucial businesses find the right time to sell, this means considering the performance of the business, the receptiveness of the market and alignment of leadership and shareholders. Jeremy Furniss, Managing Director at Arrowpoint Advisory and Tim Phillips, co-founder of Gate One, shared their expertise on how entrepreneurs should prepare for any future exit. Watch this now.

 
Man walking up the stairs of Rothschild & Co New Court office

The journey to sale

It’s crucial businesses find the right time to sell, this means considering the performance of the business, the receptiveness of the market and alignment of leadership and shareholders. Jeremy Furniss of Arrowpoint Advisory and Tim Phillips, co-founder of Gate One, shared their expertise on how entrepreneurs should prepare for any future exit.

Our Client Advisers are a great sounding board for all your financial questions. Below we answer some of the most common questions they have been asked.

What is Business Asset Disposal Relief?

Business Asset Disposal Relief – previously known as Entrepreneurs' Relief – is a tax benefit in the UK that reduces the capital gains tax owed when disposing of certain business assets. It aims to encourage entrepreneurship by providing favourable tax treatment to individuals selling their businesses or shares in qualifying companies.

The relief can be used by sole traders and partners, as well as certain company shareholders and trustees. It is available when the disposal of a business, or part of a business, takes place.

The information above is not intended and should not be construed as tax advice.

Is Business Asset Disposal Relief the same as Entrepreneurs’ Relief?

Entrepreneurs’ Relief launched in April 2008 and was renamed Business Asset Disposal Relief in April 2020. The purpose and basic concept of the tax benefit remained the same, but the lifetime limit the relief was lowered from £10 million to £1 million.

The maximum capital gains tax saving using Business Asset Disposal Relief is £100,000 – the difference between paying tax on £1 million at 20% and paying the tax at a rate of 10%.

The information above is not intended and should not be construed as tax advice.

What businesses qualify for Business Asset Disposal Relief?

There are rules which limit who can benefit from Business Asset Disposal Relief. Individuals selling all or part of their business must have been a sole trader or business partner for at least two years up to the date of the sale.

When selling shares, the business must be classified as a “personal trading company” in order to qualify. The individual claiming the relief should be an officer or employee of the company, or hold at least 5% of the company's ordinary share capital and voting rights. Qualifying shares must be ordinary shares with voting rights and carry the right to at least 5% of the company's distributable profits and net assets.

These conditions must have been met for at least two years before the disposal date.

The information above is not intended and should not be construed as tax advice.

For more information on Business Asset Disposal Relief, please read our article, 'Earn tax relief when selling your business'.

UK wealth management insights

  • Is a wealth manager worth it?

    Insights

    We all like to achieve good value for money, but it's particularly important when choosing a wealth manager. You are entrusting someone with you and your family’s financial future, and in this article we outline how to assess the value of a wealth manager.

    Donald Nartey

  • Our culture, service and people

    Insights

    We pride ourselves on our company culture, values and people at Rothschild & Co Wealth Management UK. Our business is built on the strength of our people and the relationships they have with clients, and we believe this sets us apart from other wealth managers.

    Holly Jennings, Nick Berman

  • Making the best investment choices

    Insights

    There are many ways you can grow and preserve your wealth by investing. In this article we discuss how to find an investment style that suits your outlook, examine both ‘top-down’ or ‘bottom-up’ investing strategies, and assess active and passive investing.

    Morten Hemdorff