Post‑Exit Wealth: The Four Structures That Do the Heavy Lifting

The structures I keep coming back to for founders and executives in the first years after a liquidity event.

A significant part of my work right now is with founders and senior executives in the first couple of years after an exit. I thought it might be useful to share the structures we are using, as a few clients had not come across them before.

The first years after a liquidity event are their own distinct planning problem. The wealth has arrived, often suddenly and in a single lump, and it needs to become something more considered than a very large cash balance. The instinct is usually to reach for either "invest it" or "shelter it", as though those were the only two moves. In practice, the useful work is more structural, such as choosing the right wrappers for the right money, matched to what you actually want it to do.

Four tools tend to do most of the heavy lifting, often in combination. None is a silver bullet, and none is right for every situation. But between them they cover most of what I would look to explore with someone in this position.

1. Offshore investment bonds

An offshore bond is a wrapper that holds a diversified portfolio and changes how that portfolio is taxed. The central feature is gross roll up, which means no ongoing UK income tax or capital gains tax while the money stays inside the wrapper, so investments compound efficiently and the manager can rebalance freely without creating annual tax events.

The flexibility comes from the withdrawal rules. You can take up to 5% of the original premium each year, on a cumulative basis, for 20 years. These withdrawals are usually treated as a return of capital for tax purposes until the total exceeds the original premium, at which point gains are assessed. The cumulative tax point comes later, at encashment, when the accumulated gain is assessed. Because of the chargeable event regime and top slicing relief, those gains can be timed into lower income years such as the year you stop working or a gap year between roles to manage the eventual charge.

Bonds are also segmented into individual policies at outset, which makes them straightforward to assign into trust or to gift to family. Assigning a segment is not itself a chargeable event, so the recipient steps into your shoes and the eventual tax is assessed at their marginal rate rather than yours. That makes the bond a genuinely useful succession tool as well as an investment wrapper, particularly where children are basic rate or non‑taxpayers.

Where it fits: Someone who wants efficient, low admin compounding, flexible income they can time, and a clean route to pass value down later without ongoing governance.

2. Family investment companies

A family investment company (FIC) is exactly what it sounds like, a private company, funded by the founder, that holds investments rather than trades. Its appeal is twofold, one part about tax rates and one part about succession.

On tax rates: Income and gains inside the company are taxed at corporation tax rates rather than personal ones, and most dividend income the company receives falls within the corporate dividend exemption. The main corporation tax rate is 25%, which sits meaningfully below income tax at 40% or 45%, so for money you intend to reinvest rather than spend, the FIC can compound more efficiently. Anti‑avoidance rules for close companies and settlements can apply if the structure is misused, so the details matter.

But the real advantage is intergenerational. The founders subscribe for preference shares carrying voting rights and priority on capital, keeping control and access. The next generation takes ordinary shares at their market value at inception, which is low because the company has only just been established. As the portfolio compounds, the growth accrues to those ordinary shares. The value migrates to the next generation without a classic potentially exempt transfer and without a seven year survival clock in the usual sense, because the growth shares were issued to them at inception and were never in the founders' estate. Whether any settlement or associated operations analysis applies depends on the specific facts and must be checked case by case.

Where it fits: A founder with surplus capital they do not need for income, adult children, and an estate already above the threshold. Below roughly £2m of investable capital, the setup and ongoing administration, accounts, governance, record keeping can often outweigh the benefit for many families. It is a serious structure for the right family and expensive overhead for the wrong one.

3. Gilt portfolios

Gilts solve a specific and common post‑exit problem, which is where to hold money you can't yet invest for the long term because you require it for near‑term spending, an upcoming tax bill or a cash buffer without it being destroyed by tax drag and inflation, as cash so often is.

The mechanic is simple and powerful. For most UK government gilts held directly by individuals, capital gains are exempt from capital gains tax. A low coupon gilt trading below par delivers much of its return as capital growth rather than income, so a large part of the return arrives entirely tax‑free. Accrued interest is still taxable as income, but the capital growth component is what drives the tax advantage. For a 45% taxpayer, the taxable equivalent yield can be highly attractive and far better after tax than a cash account paying a similar headline rate, at a comparable level of risk when the gilt is short dated and held to maturity.

A maturity ladder can also be built so that gilts mature in line with specific future liabilities, a tax payment due in eighteen months, school fees, a planned purchase. That turns gilts into a precise cash management tool, not just an investment. They can be used for money set aside for a known bill, held tax efficiently, arriving exactly when it is needed.

Where it fits: Almost anyone post‑exit sitting on cash they will need in the next few years, and high earners especially, for whom the tax saving is largest.

4. Trusts

Trusts are rarely the whole answer, but they are often what brings the rest of the structure together. A trust adds a layer of control, asset protection and clarity around succession that the other tools do not provide on their own, such as governing who receives what, and when, rather than simply moving value around.

They are frequently used alongside the other three, for example, a bond assigned into trust for a child, or a trust holding shares in a FIC. That combination is often where the real planning happens, as the wrapper handles the tax efficiency and the trust handles the control and the timing.

The caveat is that most discretionary trusts sit within the relevant property regime, which brings its own inheritance tax mechanics, such as a potential entry charge calculated at lifetime rates (up to 20% on value above the available nil‑rate band), periodic charges roughly every ten years, and exit charges on distributions. These are manageable, but they mean a trust needs deliberate thought rather than being a default. Used carelessly they add unnecessary cost and complexity; used well, in the right circumstances, they are what makes the whole structure hold together.

Where it fits: Someone who wants to add control, asset protection and clarity around succession to the other tools, and who is comfortable with the additional complexity and cost.

How they work together

The point is not to choose one of these, and they are rarely used in isolation. A typical post‑exit structure might hold near‑term money and funds for the next tax bill in a gilt ladder, longer term growth in an offshore bond, surplus reinvestment capital in a FIC for the next generation, and a trust sitting over part of it to govern control and succession. Each tool does the job it is best suited to, and the combination is what delivers the outcome.

None of this is one size fits all. The right answer depends on your objectives, your liquidity needs, your family circumstances and what you already have in place. There is no objectively correct structure for post‑exit wealth, the correct structure or structures will depend on the individual and their priorities. But between them, these four cover most of what I would look to explore with someone in the first years after an exit. The structure should serve the life you want after the sale, not the other way around.

Three questions if you're in the first years after an exit

• Is your money structured and matched to what you want it to do, such as cash for near‑term spending, funds invested for long term growth, and money set aside for the next generation or is it all sitting in one undifferentiated pot?

• Are you holding cash for an upcoming tax bill that a gilt ladder could hold far more efficiently?

• Have you thought about succession while the wealth is being structured, or is that a conversation still waiting to happen?