For family business owners, succession is about much more than tax. It is about what happens to a business you may have spent decades building, how the next generation fits into its future, and how you protect both the business and the family behind it.
Thankfully, the recent Budget brought fewer unpleasant surprises for business owners considering succession. However, with significant changes to Business Relief from inheritance tax now in force, business owners should be thinking carefully about succession.
Since 6 April 2026, 100% Business Relief has been capped at £2.5 million per individual, with qualifying business assets above that threshold receiving 50% relief. For some families, this may mean greater inheritance tax exposure than previously anticipated. So, Business Relief is not dead. What has changed is that it cannot be relied on so heavily and there is now a need to consider it as part of a much wider conversation about the future and managing Inheritance Tax
At Cripps, our starting point is to understand what the family wants to achieve. Who should run and ultimately own the business? How much control should the current generation retain? When should the next generation become involved? And how does the family’s wider wealth fit alongside the business?
There is no single solution. Planning might involve trusts, changes to share ownership and governance, or a Family Investment Company (FIC). A FIC can provide a framework for passing value to future generations while allowing founders to retain an appropriate degree of control. For some families, combining trusts and a FIC can provide further flexibility.
Our Personal Tax & Succession and Corporate teams work together, alongside clients’ existing advisers, to consider not only how wealth should pass between generations, but how the business should be owned, governed and managed through that transition.
We recently advised a family with a business valued at tens of millions on bringing the second generation into the structure while protecting wealth for future generations. The solution combined trusts, a FIC and a family charter, reflecting both the family’s commercial ambitions and its wider values.
Good succession planning rarely starts with a particular structure. It starts with a conversation. And the earlier that conversation takes place, the more options families are likely to have.
To discuss the future of your family business, speak to Paul Fairbairn or Charlotte Dixon, or visit Cripps’ Business Relief hub to find out more.
