How to Pass Your Business to the Next Generation – Without Losing Value
16th Jul 2025

Preserving Business Value Through Strategic Succession Planning
Whether your children want to take over or not, a poorly planned handover can destroy business value and cause family friction.
You’ve built a thriving business. Your wealth is secure. But one question keeps surfacing:
“What happens to all of this when I step back?”
Succession planning isn’t just about family dynamics, it’s about protecting the value, continuity, and reputation of your business. Without a clear plan, even successful firms risk significant losses.
The Cost of Poor Succession Planning
Based on a survey undertaken by Conway centre for family business, only 30% of family businesses survive into the second generation, and just 12% make it to the third. The reasons? Lack of planning, leadership gaps, and tax inefficiencies.
Industry research suggests that businesses without a formal succession plan can experience significant valuation loss, often estimated between 20–30%, due to leadership uncertainty, staff turnover, and client attrition.
What Can Go Wrong?
Even businesses with 8-figure turnovers and loyal teams can falter. Common risks include:
- Value leakage from poorly timed sales or handovers, triggering unnecessary CGT or IHT
- Leadership gaps when successors aren’t ready or transitions are rushed
- Ownership conflicts due to unclear share structures or family disputes
- Operational disruption as clients and staff lose confidence in leadership continuity
What Needs to Be Aligned for a Smooth Transition?
Succession is a multi-dimensional process. Here’s what to consider:
1. Leadership & Skills Planning
- Is your successor commercially ready?
- Do they need mentoring or phased involvement?
- Could a Chair or Non-Exec role help you ease out gradually?
Tip: A phased succession builds confidence among clients and staff while allowing successors to grow into leadership.
2. Share Structure & Ownership Planning
- Will shares be gifted, sold, or inherited?
- Consider:
- Alphabet shares to control dividends and voting rights
- Trusts for tax-efficient holding
- Family Investment Companies (FICs) for long-term wealth preservation
2025 Tax Insight: Business Property Relief (BPR) remains essential for IHT mitigation. HMRC is tightening scrutiny, especially for businesses with passive investments. Review your structure now.
3. Capital Gains & Inheritance Tax Strategy
- CGT applies on share sales; IHT applies on death if assets aren’t protected
Use:
- Gift Hold-Over Relief to defer CGT on qualifying business shares
- Potentially Exempt Transfers (PETs) for lifetime gifting
- Spousal exemptions and trusts for strategic planning
2025 Allowance Update:
- CGT Annual Exemption: £3,000
- IHT Nil Rate Band: £325,000
- Residence Nil Rate Band: £175,000 (for qualifying estates)
Why Wright Vigar’s Succession Planning Works
We combine the personal approach of a trusted adviser with deep technical expertise in:
- Tax mitigation strategies
- Shareholder and trust structures
- Estate and IHT planning
- Compliance and reporting during exit
Our team works discreetly, collaboratively, and with your long-term goals in mind.
Speak to Someone Who Has Helped Businesses Like Yours
Whether you're preparing for retirement, stepping back from operations, or planning your estate, succession should never be left to chance.
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