Former Surgeon Embarks on Business Ventures to Minimize Inheritance Tax Liabilities
Dr. Kevin O'Sullivan, a 72-year-old ex-surgeon, has built a successful career as an entrepreneur, founding or acquiring four diverse businesses: a care home, a hotel, a recruitment company, and two Cash Converters franchises.
Driven by a desire to provide exceptional customer service rather than solely pursue financial gain, Dr. O'Sullivan's businesses have thrived. However, recent changes to inheritance tax business relief and the threat of further tax increases under the current government have prompted him to consider relocating abroad permanently.
With three step-children in their 40s and several grandchildren, Dr. O'Sullivan aims to minimize the impact of inheritance tax on his estate. He is exploring the concept of tax exile, potentially moving to Dubai, Malta, Portugal, or the US where inheritance tax thresholds are more favorable.
Currently, Dr. O'Sullivan's income is primarily derived from dividends from his businesses. He has made a significant dent in his self-invested personal pension (Sipp) by withdrawing his 25% tax-free lump sum. To avoid sacrificing his personal allowance, he has kept his income below £100,000 per year.
Financial experts advise Dr. O'Sullivan to adopt a clear strategy based on his specific goals and circumstances. Given his wealth preservation objective, they recommend maximizing pension contributions to strengthen future income streams and reduce corporation tax. Additionally, they suggest utilizing gift allowances and exploring tax relief schemes such as VCTs, EIS, and trusts.
While moving abroad may seem like an attractive option, careful planning and investment strategies can help Dr. O'Sullivan achieve his goals while minimizing tax liabilities.