Business owners and directors
Advice for people whose wealth is tied up in what they built
For most owners the business is the pension, the savings and the inheritance all at once. Advice is about getting value out of it, in the right order, without being taxed twice.
Getting money out of the company
Salary, dividends and pension contributions are each taxed differently, and the right mix changes whenever the rules do. For 2026/27, dividends are taxed at 10.75%, 35.75% and 39.35% with only the first £500 free, and employer National Insurance stands at 15%. Against that, an employer pension contribution is normally deductible against corporation tax, attracts no National Insurance and is not taxed on you when it goes in.
For many directors that makes the company pension contribution the most efficient way of taking value from the business, within the annual allowance and using carry forward from earlier years where profits allow.
Protecting what you have built
A business is usually more fragile than its accounts suggest. Lenders, customers and co-owners often depend on one or two people. Key person cover gives the business cash if one of them dies or becomes seriously ill. Shareholder protection, with a properly drafted agreement, gives the remaining owners the money to buy out a deceased owner's family, so that the family is paid and the business stays in the hands of the people running it. A relevant life policy gives a director personal life cover paid for by the company.
Planning for the exit
Whether you intend to sell, hand over to family or management, or simply wind down, the tax outcome depends on decisions made years beforehand. Business Asset Disposal Relief now applies a rate of 18% to the first £1 million of qualifying gains in a lifetime. Since 6 April 2026, business property relief from inheritance tax is given at 100% only on the first £2.5 million of qualifying assets, with 50% above. Surplus cash held in the company, and how shares are held between spouses, can affect whether those reliefs apply at all.
An adviser works with your accountant and solicitor on the financial side of that plan: what you will need to live on afterwards, how the proceeds will be invested, and how to move value out of the business and into your own name gradually rather than all at once.
What an adviser helps with
Where advice makes the difference
Salary, dividends and pensions
The most efficient way of paying yourself this year, reviewed as rates and profits change.
Director and employer pensions
Company contributions, carry forward and, where appropriate, pension structures that can hold business premises.
Protecting the business
Key person cover, shareholder and partnership protection, and relevant life policies.
Surplus cash
What to do with profits retained in the company, and the effect on tax reliefs of holding too much.
Exit and succession
Preparing for a sale, a management buyout, an employee ownership trust or a family handover.
Life after the sale
Turning a one-off sum into a lasting income, and the inheritance tax position once shares become cash.
Calculators
Put a number on it first
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Tax
Income tax calculator
Take-home pay, your true marginal rate, and what it costs to escape the £100,000 allowance trap.
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Tax
Pension annual allowance calculator
Whether the taper reduces your allowance, how much you can still pay in, and any charge on the excess.
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Inheritance
Inheritance tax calculator
Estimate the inheritance tax on your estate, with the residence nil-rate band, gifts and the 36% charity rate.
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Questions
What people ask us
Is it better to take dividends or pay into a pension?
For money you do not need to spend now, an employer pension contribution is often more efficient: it is normally deductible for corporation tax and free of National Insurance, whereas dividends are paid from taxed profits and taxed again on you. The right balance depends on your income needs, your age and your allowances.
Can my company pay my life insurance?
Yes, through a relevant life policy. The company pays the premiums, which are usually an allowable business expense and not treated as a benefit in kind, and the policy is written in trust for your family. It suits directors of small companies that do not have a group scheme.
How far ahead should I plan a sale?
At least two to three years, and longer if you can. Several reliefs depend on how long shares have been held and how the company is structured, and buyers pay more for a business that does not depend on its owner. The financial planning, including what you will need afterwards, should start at the same time.
What happens to my business if I die?
That depends on your will, your articles and any shareholder agreement. Without planning, shares may pass to family members who cannot run the business and cannot easily sell, and inheritance tax may be due where the value exceeds the available relief. Shareholder protection and an up-to-date will address most of it.
This page is general information, not financial advice. WealthWise Connect is an introducer and is not authorised or regulated by the FCA; advice is given by the regulated adviser we introduce. Other areas: Pensions and retirement, Investments and ISAs, Inheritance tax planning, Tax planning for high earners, Protecting your family, British expats and returners.
Plan the business and your own finances as one.
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