How a family investment company (FIC) works

A family investment company can provide a good approach to ensure that wealth is preserved for the next generation, whilst maintaining control. There will also be legal, commercial and emotional aspects that need to be considered.

What is a family investment company (FIC)?

A FIC structure will be specific to each family and will be dependent upon the assets and individuals involved. It is a private investment company where the directors and shareholders of the company are family members or trusts. For individuals who are looking to pass on wealth, they could be the principal directors to ensure that they have full control over how the assets are managed.

Family members are likely to have been involved in or surrounded by a company for many years. Most will be familiar with an underlying company structure and how income can be extracted and profits retained. Having a structure which family members understand will add to the appeal of setting up something to protect the family’s assets.

Our latest factsheet outlines why FICs are attractive, how to minimise the inheritance tax that could arise on the wealth in an FIC and the structuring of an FIC.

You can download the factsheet here