Transfer of assets, father to son.

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cavanmaneman

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Hi all, my father retired recently form business and wants to transfer business shares and a property to me. All in all I'm looking at a fairly hefty tax bill and don't have the money. My question is will I be able to get a loan against the property to pay the tax. Who or what bank would be best to deal with or would you recommend a certain type of business adviser.
thanks
 
cavanmaneman said:
Hi all, my father retired recently form business and wants to transfer business shares and a property to me.
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Why would he want to do this? Has he spoken to a solicitor. You didn't give us any figures, I would imagine you could get a loan, but you ought to speak to a good accountant so you structure this in a way that minimises taxes.
 
Bronte said:
Why would he want to do this? Has he spoken to a solicitor. You didn't give us any figures, I would imagine you could get a loan, but you ought to speak to a good accountant so you structure this in a way that minimises taxes.
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He is getting on and wants to secure the business shares with me so I get control over the business -which may be challenged in a will- I am meeting a good TAX accountant but I am basing my figures on CAT rates etc so I have a good estimate of what the bill will be. (€100k)
Even though I can't afford it I know that the assets are strong and worth borrowing for. I am wondering if you can borrow against assets? or have banks ran to the hills on such things.
 
If this is a family feud prevention job, it is fraught with all sorts of minefields.
Read this carefully and don't have any fool tell you it don't apply: where there is money it will be used.
http://www.irishstatutebook.ie/1965/en/act/pub/0027/sec0117.html#sec117
There is usually a 2 year window from the date of transfers of assets like this and the death of the disponer during which such transfers can be challenged.
Also look up the use of a caveat by the opposition, cheap at 11 or so euro but mega effective in forcing a payout.

Bronte, at 10k plus posts, is highly respected around these parts so less of the shouting please: TAX

Re the bank: if the cash flow and asset cover is there, then it will be lent:

Say you want 100k over 10 years at 8% pa so the monthly payments for P&I will be c 1500/month?
Can it service this sort of cash outlay
 
OP - go get proper advice. Neither you nor anyone else has mentioned business property relief or the applicable CAT group threshold. It is possible that you could receive business assets worth in excess of €2m without owing a penny in CAT.

Ircoha- you are making a lot of assumptions above. Including that the OP "shouted" at Bronte. While she has a heap of posts to be fair she is always quick to state she isn't an accountant/ tax specialist (and equally quick to chide in a lot of cases).

Bronte - what do you mean "Why would he want to do this"?. Not that it's relevant to the OP's question but the country (and the world) is littered with family businesses that have continued through generations. So I'd suspect he wants to secure the succession of the business to the child who is best qualified / most capable / most interested in it / has worked in it and contributed most to its success...

This is nothing new and provisions like CGT retirement relief and CAT business property relief Facilitate orderly succession planning. Specifically so that people aren't hanging onto the ownership of the family business until they're old and infirm, with a child / children having worked half their life in the business on the explicit promise of succeeding to it. There's a whole body of academic research into the psychology and economics of succession planning. But I suppose the short answer to your question is, None of your business!
 
Jon Snow said:
OP - go get proper advice. Neither you nor anyone else has mentioned business property relief or the applicable CAT group threshold. It is possible that you could receive business assets worth in excess of €2m without owing a penny in CAT.

Ircoha- you are making a lot of assumptions above. Including that the OP "shouted" at Bronte. While she has a heap of posts to be fair she is always quick to state she isn't an accountant/ tax specialist (and equally quick to chide in a lot of cases).

Bronte - what do you mean "Why would he want to do this"?. Not that it's relevant to the OP's question but the country (and the world) is littered with family businesses that have continued through generations. So I'd suspect he wants to secure the succession of the business to the child who is best qualified / most capable / most interested in it / has worked in it and contributed most to its success...

This is nothing new and provisions like CGT retirement relief and CAT business property relief Facilitate orderly succession planning. Specifically so that people aren't hanging onto the ownership of the family business until they're old and infirm, with a child / children having worked half their life in the business on the explicit promise of succeeding to it. There's a whole body of academic research into the psychology and economics of succession planning. But I suppose the short answer to your question is, None of your business!
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Great help their Jon, I of course am aware of business relief and am including this in my assumptions, total assets are indeed around the figures you mention. I will be well advised on this and CAT rates etc. My biggest need now though is a loan.
 
cavanmaneman said:
Great help their Jon, I of course am aware of business relief and am including this in my assumptions, total assets are indeed around the figures you mention. I will be well advised on this and CAT rates etc. My biggest need now though is a loan.
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You really need to get proper advice on this, given the sums/values involved, but I can think of at least one straightforward way that the thing could be structured so that any CAT liability falling due can be covered without you having to indebt yourself personally.

When it comes to tax advice, you generally get what you pay for.
 
Jon Snow said:
You really need to get proper advice on this, given the sums/values involved, but I can think of at least one straightforward way that the thing could be structured so that any CAT liability falling due can be covered without you having to indebt yourself personally.

When it comes to tax advice, you generally get what you pay for.
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I have another meeting later this week and will let you know how I get on.
 
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