As financial planners who work closely with business owners, and their tax advisors, we’re seeing one question come up more and more: “I’ve built my company, what’s the smartest way to exit?” The short answer? It depends. But 2025 brings major changes that are worth knowing if you’re thinking about stepping away from your business – or passing it on.
Meet James and Maria (Or Maybe It’s You)
James and Maria are both aged 68. They’ve spent decades building a successful business, now valued at around €15 million. They have two adult children, both doing well. They are proud of what they have built, but they are now starting to think about the next chapter. Should they sell? Gift the business to their adult kids? Move abroad? Each choice has real financial consequences – especially when it comes to tax.
Let’s break it down.
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The Big 2025 Retirement Relief Changes
If you’re aged between 66 and 69, there’s a significant planning window open. The tax-free cap for transferring a business to your children could now be as high as €10 million, up from the previous €3 million limit. That’s a potential €7 million in additional relief, but it hinges entirely on timing. Once you turn 70, the cap reverts to €3 million, meaning the opportunity narrows considerably. For family business transfers, this could be a decisive factor, especially if you’re already within that key age range. Now is the time to evaluate your plans with care.
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Entrepreneur Relief Still Has a Role
Entrepreneur relief still gives a 10% tax rate on the first €1 million of lifetime gains, but beyond that, you’re facing 33% Capital Gains Tax. Not ideal if your business is worth multiples of that.
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Should You Use a Holding Company?
Holding companies can be powerful tools. They allow you to sell your trading company without triggering a tax bill, at least initially. But the challenge then becomes: how do you get that value into your own hands, tax efficiently?
Some options include:
- Drawing salaries and pension contributions
- Taking out a low-BIK company loan to buy a home
- Investing via the company in property, private equity or corporate investment bonds
- Leaving shares to your spouse in your will (no tax on transfer to a spouse)
- Structured gifting to your children
The right option depends on your broader financial plan.
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Thinking About Leaving Ireland?
For some entrepreneurs, relocating for tax reasons is worth exploring. Italy now offers favourable tax regimes for “new residents,” including:
- A €200,000 flat annual tax on most foreign income
- A 7% tax rate for pensioners in southern regions
Combine that with smart planning and Ireland’s tax treaties, and some entrepreneurs are exiting with significantly lower tax bills on dividends or pension drawdowns.
It’s not for everyone – and it requires careful timing and structuring – but for certain clients, it’s worth exploring.
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So…What should you do?
That depends on:
- Your age and the value of your business
- Your family situation and goals
- Whether you want to sell or pass on the company
- If you’re open to moving or retiring abroad
- And most importantly, how well your financial and tax planning is aligned with your personal goals
Planning Ahead = Paying Less Tax
At Chartered Capital, we don’t provide tax advice, but we do help business owners make informed, well-coordinated decisions. We work closely with clients and their tax advisors to ensure financial and tax planning go hand in hand. If you don’t have a tax advisor, we’re happy to recommend one. Whether you’re selling, stepping back, or passing the business on, early planning can help you make the most of the opportunities available – and avoid costly surprises.
Important Notice: Chartered Capital are NOT tax advisors. The information provided in this article is for general guidance only and does not constitute tax advice. We strongly recommend that business owners seek advice from a qualified tax professional before making any decisions related to the sale, transfer, or restructuring of their business.
In Their Own Words
