Creating A Holding Company

Many global corporations employ group company structures to simultaneously own and manage multiple companies, mitigating risks, and potentially optimising tax obligations. The primary concern for these entities is insolvency, and by utilising a holding company, as long as the holding company hasn't provided guarantees for the debts of its subsidiaries, it shields the remaining assets of the holding company from subsidiary company liabilities. This safeguards the holding company's assets, with the only potential loss being the investment in the subsidiary.

Creating a parent or holding company in Northern Ireland can have various tax implications. These implications will depend on the specific circumstances of the companies involved, the structure of the group, and the tax laws and regulations in place at the time. A parent company provides various tax benefits for subsidiaries of the parent/holding company. These include:

• Tax reliefs for subsidiary companies – Holding/parent companies can pass assets between them tax-free with ease.

• Selling the business tax-free - When a Holding Company has maintained ownership of at least 10% of a subsidiary company's shares for a continuous period of 12 months or more, these shares can be divested without incurring Corporation Tax.

• Inheritance tax reliefs - Parent companies can qualify for Business Property Relief which reduces the value of assets which are subject to Inheritance Tax on transfer.

The duration of restructuring with a parent/holding company in Northern Ireland can vary significantly depending on the complexity of the process, the size of the organisations involved, and various other factors. Typically, it may take several months to complete such a restructuring, but it could extend to a year or more in more intricate cases. Our expert team will ensure that all aspects of the restructuring are properly managed and that it complies with legal requirements and regulations while saving you time and costs.