Case Study: Financial Planning for Entrepreneurs

There are many benefits of working with a financial planner if you’re an entrepreneur.

This was certainly the case for David and Sally. The couple runs a successful business buying and renovating properties in London. Once renovations are complete, the properties are rented on a short-term basis to corporate clients who require accommodation for overseas employees.

Although the business has been very successful in a short space of time, the couple had never taken much money out of the business and continued to live quite frugally.

Having worked hard building their property business, they were introduced to Scott at First Wealth by their accountant early in 2020. Their accountant understood how David and Sally could improve how they managed their business and personal finances, but they needed help and advice from a specialist financial planner.

We worked with David and Sally to improve their personal financial situation by addressing their pensions. We also helped them with solutions for getting value out of their business while mitigating tax charges. And we looked at other ways they could make significant tax savings through ongoing financial planning.

We’ll help you plan the best way to fund your personal goals and aspirations

David and Sally had built a really good business but now felt they should be doing something more.

As parents to twins aged five and a new baby on the way, they wanted to buy a bigger house outside London and a second home. They knew how they wanted their new house to look but had no idea how to fund it, or how best to manage their finances in the future.

They’d built up a significant amount of cash within the business and needed sensible planning; planning which would benefit them individually, while also benefiting the business.

Neither David nor Sally had saved into pensions since becoming self-employed. They each had an old pension from previous employment, but the funds were small.

David and Sally’s goals

  • Ensure they benefited from the value they had worked hard to accrue
  • Address their lack of pension savings
  • Ensure they, and the business, were financially protected in the event something happened to either of them
  • Reduce the amount of surplus cash held in the business.

From a SIPP and ISA to protection: how we helped David and Sally

Having worked for years to build their business, David and Sally were ready to enjoy life. They wanted to spend some of their hard-earned money and plan for their future.

David had always had a vision for a company head office but wasn’t sure whether purchasing outright was the best thing. We spoke to him about the opportunity to buy the property within a pension and set up a self-invested personal pension (SIPP).

Because he had a pension, he could also utilise carry-forward. Instead of being limited to the Annual Allowance (£40,000), David was able to contribute significantly more money to his pension (up to £160,000 in the right circumstances).

We then arranged for David to borrow from his SIPP to purchase the office they wanted.

Their head office is now owned by David’s pension, making it a separate entity from the business. The business rents the office, and the rental income goes back into the pension.

This also sets them up with a second asset to sell in the future.

By owning property through the SIPP, David still benefits from the usual relief on his pension contributions, there’s no Income Tax payable on the rental income, and no Capital Gains Tax to pay when the property is sold.

With so much cash on the books, the couple also each made ISA investments.

Finally, it was necessary to ensure David and Sally had the right protection in place. With a joint mortgage, twins and another baby on the way, they wanted to ensure that they’d be financially secure should anything happen to either one of them.

As business directors, arranging life insurance through the business was sensible planning. They hadn’t realised the benefits of doing this and were pleased to discover the payments were tax-deductible.

As David is the founder of the business and a proactive leader, his absence would cause the company to suffer, so also helped set up key person insurance.

Along with property purchases, pension arrangements and protection, there was still the need to get money out of the business and mitigate tax charges.

Sally and David achieved this through Venture Capital Trusts (VCTs). They took money from the business as a dividend and reinvested the proceeds into the VCT, giving them Income Tax relief and helping offset the majority of the tax that would be due on the dividends.

VCTs have been the ideal vehicle for getting money out of the business with minimal tax charges.

While VCTs offered potential benefits to this couple, VCTs are a high-risk investment so won’t be suitable for everyone. Speak to us for advice.


  • Personal finances organised giving peace of mind
  • SIPP established and used to purchase the head office
  • Monthly rental income from the head office is paid back into the SIPP, servicing the mortgage and increasing the value of the pension
  • Personal and business protection run through the business for tax efficiency
  • Excess cash extracted from business through tax-efficient VCTs.

Find out how we can help you

If you’re an entrepreneur and would like to talk to an expert financial planner, get in touch. From tax planning, business protection strategies and ensuring your money is working as hard as you are so you can enjoy life when you retire, we have the understanding, knowledge and expertise you need.

Email or call 020 7467 2700 to find out more.

This document is marketing material for a retail audience and does not constitute advice or recommendations. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amount originally invested.

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