Meet John and Sandra
Challenge:
An uncommon solution to a common challenge
John and Sandra owned a family business worth in excess of $1 million. They wanted to make the transition into retirement and sell the family business to their son Jack. Although, Jack has been working in the business and would naturally progress to taking it over, he did not have the cash to purchase it. John and Sandra on the other hand, required the money to fund their retirement.
The combined efforts of the accounting and financial planning team devised a plan to ensure that after the exit of the parents, for the next 15 years, $100k of the profits of the business will go into their super fund, but the day to day control of the business is taken care of by Jack.
What this actually means is that Jack was able to use the tax system to fund the purchase price and John and Sandra were able to get a rate of return, after tax, much higher than the traditional approach.
Plus we have a happy family and a second generation business.
* Names have been changed for privacy
Contact Snelleman Tom to discuss your future today
Contact Snelleman Tom to discuss your future today