Advice on opening a French branch or subsidiary post-Brexit

Brexit has introduced significant barriers to trade between the UK and the EU. Many companies are struggling with increased red tape, delays, and complex restrictions, making cross-border business more challenging than ever.

To mitigate these difficulties, a growing number of UK businesses are considering establishing a branch office or subsidiary in France. With its streamlined processes and strategic location, France offers one of the quickest and most practical solutions for maintaining an EU presence.

In this guide, we’ll explain the differences between a branch and a subsidiary, walk you through the setup process, and outline key legal considerations.

Branch vs. Subsidiary: Which is right for your business?

Choosing between a branch and a subsidiary depends on your business goals. Each structure has its advantages and legal implications.

What is a Branch?

A branch is an extension of your UK company rather than a separate legal entity. It has no independent legal personality, simplifying the setup process.

Benefits of a French branch:

  • Faster and easier setup
  • No need to draft new statutes or incorporate a separate entity
  • Cost-effective compared to a subsidiary

Key requirements:

  • Provide certified French translations of company documents (e.g., Articles of Association)
  • Register with the French Commercial Court Registry
  • Publish an announcement in a legal journal
What is a subsidiary?

A subsidiary, unlike a branch, is an independent legal entity incorporated under French law. While it requires more administrative effort, it offers greater legal protection and operational flexibility.

Benefits of a French subsidiary:

  • Separate legal responsibility from the parent company
  • Easier to establish business contracts with French companies
  • Enhanced credibility in the French market

Key steps to set up a subsidiary:

  • Draft company statutes
  • Open a corporate bank account in France
  • Register the company with the Commercial Court
  • Appoint a legal manager and accountant

Hiring employees for your French Office

Both branches and subsidiaries can employ staff. However, French employment law will apply, and it’s crucial to comply with local regulations. During the initial phase, you can second employees from your UK company for up to 12 months, subject to renewal in certain cases.

Important Considerations:

  • Employment contracts must meet French legal standards
  • French law mandates public order rules that cannot be waived
  • Provide competitive salaries and benefits in line with French norms

Navigating French Commercial law Post-Brexit

Since Brexit, many French companies prefer formal contracts governed by French law. It’s essential to understand key principles in French commercial law, including:

  • Duty to inform: Businesses must disclose critical information during negotiations.
  • Abuse of dependency: Contracts may be invalidated if they result from an imbalance of power.
  • Unilateral price setting: Allowed in framework contracts, provided prices are justified.
  • Imprévision: Contracts may be renegotiated in the event of unforeseen circumstances.
  • Contract termination rights: Contracts without end dates are terminable without notice.

Resolving commercial disputes in France

Commercial disputes in France are handled by specialised Tribunaux de Commerce, ensuring faster, cost-effective resolutions. The Paris Commercial Court even has an international division with English-speaking judges, providing a practical option for UK businesses.

Partner with French legal experts

Setting up a branch or subsidiary in France can provide significant advantages in navigating Brexit trade challenges. Our specialist French Avocat  Hervé Blatry offers tailored legal support, guiding you through every step of the process.

Contact us today to explore how we can help your business succeed in France.

Employment tribunal: A guide for employers

If not managed effectively, workplace conflict can be hugely costly for employers and lead to employment tribunal claims. According to new research from ACAS, nearly 10 million people experienced conflict at work in 2018/19. As a result, close to 900,000 took time off and nearly half a million resigned. In addition, 300,000 employees were dismissed due to conflict. According to the report, the management and resolution of such conflicts costs employers a staggering £28.5 billion every year. However investment in early intervention and measures to promote effective resolution of disputes can save businesses time and money and reduce the risk of potentially damaging litigation.

What are common reasons for employment tribunal claims?

Common claims include:

  • unfair dismissal
  • disputes relating to redundancy
  • breach of contract
  • discrimination (for example on the grounds of disability, gender, race, sexual orientation or other protected characteristic)

Managing conflict in the workplace: How to avoid a legal dispute

If workplace issues are not dealt with promptly, they may escalate rapidly and result in legal claims against you. According to a CIPD survey, one key thing employees want from their employers when they raise an issue is simply to be listened to.

Just under a third (31%) of respondents to the survey said their employer didn’t take them seriously when they raised an issue, while nearly half (48%) said they felt their employer had prioritised the other party’s interests over their own.

Listen

One of the most important things you can do is take issues raised seriously and give any employee who is angry or frustrated the time they need to talk about what has happened. Speaking with them privately, actively listening to their views and acting upon the complaint swiftly can be key to preventing disputes and conflict from intensifying.

If a formal grievance procedure or disciplinary process is required to effectively deal with the matter, then it should be initiated as appropriate with careful regard for your internal procedures and ACAS Code and guidance as applicable.

Take advice

Employers should take professional HR and legal advice at an early stage to ensure they can make informed choices about how to manage conflict and disputes effectively and in accordance with current employment law requirements. Employers may unwittingly fall foul of the law when they fail to seek legal advice, for example behaving in a way they do not realise may be discriminatory.

Having an employment law solicitor on hand who has an in-depth understanding of the complexities of your case can go a long way to solving grievances before they have a chance to escalate. Even if the relationship between the parties breaks down, legal professionals will ensure you conduct yourself in a way that gives employees few grounds for taking their complaint further.

Be fair

It is imperative that you can demonstrate a fair process has been followed when dealing with the dispute or grievance and that any decision makers consider matters objectively and based on the evidence before them. Your solicitor can advise you on how best to deal with the issue in a neutral and unbiased manner.

Keep a paper trail

Whether you are investigating a grievance, initiating disciplinary proceedings against an employee or dismissing a staff member, you should keep a clear paper trail as evidence. This includes records of meeting invitations and detailed notes of what was said, in addition to any emails sent or received.

If the case does proceed, you will be able to provide hard evidence that you have acted appropriately.

What happens if I am taken to an employment tribunal?

To submit a claim, your employee will normally first have to notify ACAS that they intend to do so. They will try and help you resolve the issue through a process called early conciliation, whereby they support both parties to negotiate settlement terms. I f neither party wants to attempt early conciliation, or the process fails, then your employee can then submit an ET1 claim form to which you will have 28 days to respond with your defence.

Our employment law solicitors have many years’ experience in helping employers respond successfully to claims, assisting them to prepare the documentation and evidence needed to respond to the claim and representing them at hearings.

Should I offer my employee a settlement agreement?

settlement agreement (formerly known as a compromise agreement) can be used to resolve a dispute and allow all parties to draw a line under matters and part company on a dignified basis.

The agreement typically offers your employee a severance payment in exchange for their agreement not to take any further legal action against you. However, it is important to take legal advice to ensure this is a viable option in the circumstances and how best to make an offer as you may otherwise prejudice your position.

If you offer a settlement agreement without following the right process, and your employee rejects it and goes on to make a claim anyway, any conversations you had regarding the settlement agreement can potentially (but not always) be used as evidence against you.

What are the types of employment tribunal hearing?

There are two main types of hearing:

Preliminary hearing: this is usually a short hearing to address any issues so that the case can proceed smoothly before a full hearing, this may include:

  • clarifying the issues in the case
  • establishing what documents and or witnesses are required
  • deciding questions of entitlement to bring or defend

Full hearing: is when all the evidence is heard:

  • decides whether the claim succeeds or fails
  • and, if it succeeds, what remedy is appropriate

What happens when a grievance is upheld at an employment tribunal?

The tribunal will order specific steps to be undertaken at a ‘remedies’ hearing. This could include:

  • reinstating your employee
  • paying out compensation
  • paying for loss of earnings/damages

If you fail to take these steps, you can be taken to court and forced to comply. Usually, though not always, the parties bear their own costs.

It is important to remember that the likelihood of winning is greatly increased with professional legal support.

Supportive employment law professionals

Whether you are looking for support in getting the correct policies and procedures in place, or dealing with a formal grievance, we can help. We know that every case is different, so our advice will be tailored to your circumstances.

If you are in a dispute with an employee, you need to ensure things are dealt with without delay. Taking legal advice promptly could mean the difference between winning your case and damaging your business’s reputation.

Give us a call for a confidential discussion about how we can help you defend yourself, your business and your reputation.

French Trust Rules: How to prevent your Family Trust from being undermined

Many English trusts have a connection with France, often because they own French assets like a holiday home or involve beneficiaries, trustees, or settlors residing in France. Understanding how French trust rules apply is crucial to avoiding unexpected tax liabilities and legal complications.

Understanding French residency and its impact on Trusts

A person is generally considered a French resident for any calendar year in which they spend 183 days in France, even without a permanent home there. Additionally, a person may be deemed a French resident if their main home is in France. This makes it easy for an English trust to inadvertently acquire a French connection, particularly if there are numerous beneficiaries.

Why legal expertise matters

Navigating Anglo-French legal matters requires specialised knowledge. Sarah Walker offers expert assistance in preparing French Wills, advising on French estate and inheritance tax planning, and handling trusts with French assets.

What is a Trust?

A trust is a legal structure used in England and other jurisdictions to allow designated individuals (trustees) to manage assets for the benefit of others (beneficiaries). However, trusts are not recognized in the same way in France. Since 2011, France has imposed tax regulations on foreign trusts connected to the country, applying a broad definition of what constitutes a trust.

How English Trusts can acquire a French connection

Here are some common scenarios where English trusts may become subject to French regulations:

Case study 1: The Discretionary Trust

  • Isobel Turner established the Turner Family Trust in 1989. It’s a discretionary trust with her children and grandchildren as intended beneficiaries.
  • In 2019, Isobel’s great-nephew Zak spent eight months working in France and became a French tax resident.
  • Despite Zak having a minimal likelihood of benefiting from the trust, its connection to France could trigger French reporting and tax obligations.

Case study 2: The Will Trust with French Assets

  • Joseph, a UK resident, creates a Will trust for his wife and children, including his French holiday home.
  • Upon his death, the trust will fall under French regulations due to the presence of the French property.
  • A separate French Will could have bypassed these issues.

French Trust regulations and compliance

Foreign trusts connected to France must comply with strict reporting requirements, including annual declarations to the French tax authorities. Additional declarations are required if the trust is modified or terminated.

Non-compliance penalties:

  • Fines of €20,000 or 12.5% of the trust’s total assets.
  • French authorities can investigate up to 10 years of past non-compliance.
  • Severe cases can result in criminal sanctions, including up to 5 years in prison and a €500,000 fine.

French wealth tax and inheritance tax

  • Trusts may be subject to the annual French wealth tax at 1.5% of worldwide assets if the settlor or beneficiaries are French residents.
  • French inheritance tax may also apply upon the settlor’s death or when assets leave the trust.
  • Income distributed to French residents is subject to French income tax.

While the UK-France double tax treaty may offer relief, this remains a complex area requiring specialised legal advice.

How to avoid the French trust regime

To mitigate the risk of French trust rules applying to your trust, consider these proactive steps:

  • Create a separate French will: This ensures French assets are dealt with under French law without interfering with your English will.
  • Avoid trusting French assets: Unless absolutely necessary, consider other estate planning solutions for French properties.
  • Exclude French residents as beneficiaries: Keep French residents off the beneficiary list unless unavoidable.
  • Choose non-French trustees: Appoint trustees who are not French residents to prevent further tax complications.
  • Seek legal advice before relocating: If a beneficiary or trustee plans to move to France, professional legal advice can prevent unforeseen tax exposure.

Do other countries have similar rules?

Yes. While French trust rules are well-known, other countries may also impose stringent regulations on foreign trusts with local connections. It’s vital to seek legal advice for any cross-border estate planning.

For personalised guidance on managing trusts with French connections, contact Sarah Walker . With her expertise in Anglo-French legal matters, she can help ensure your trust remains compliant and tax-efficient.

Pressure sores claims: Medical negligence

In the UK, patients in hospital and those living in care homes, benefit from a high standard of nursing and health care. However, despite progress in the management of pressure sores it remains a sombre fact that medical negligence claims are far from uncommon.

In this article  Sarah Stocker,  Associate Solicitor in Tees’ medical negligence team, explores what pressure sores are; the causes; what steps healthcare professionals should take to minimise the risk of one developing and how you can claim for compensation following the development of a pressure sore or poor management of one.

What is a coroner’s inquest?

A coroner’s inquest is a formal investigation into a death. It is held in specific circumstances, including when:

  • The cause of death is unknown.
  • The death was violent or unnatural.
  • The deceased was in custody, state detention, or detained under the Mental Health Act.
  • The death occurred as a result of a medical procedure/treatment.

Inquests are not designed to assign blame or responsibility but rather to determine the identity of the deceased, as well as when, where, and how they died.

What is an Article 2 inquest?

An Article 2 inquest is a more in-depth investigation held when the state may have failed to protect someone’s life. These inquests often involve deaths in custody, psychiatric hospitals, or other situations where the state played a role.

Prevention of future death reports

Following an inquest, a coroner can issue a Prevention of Future Death Report (PFD) if they identify risks that could lead to further deaths. These reports are sent to relevant organisations or individuals, recommending changes to prevent similar incidents.

Understanding the role of a coroner

A coroner is an independent judicial officer with legal qualifications and significant experience. Their role is to investigate sudden, unexplained, or unnatural deaths. Coroners can request post-mortems, gather evidence, and conduct inquests to establish the facts of a death.

Post-mortems: What to expect

A post-mortem, also known as an autopsy, is conducted by a pathologist to determine the cause of death. While the coroner decides if a post-mortem is necessary, they must consider the family’s views and any cultural or religious beliefs. Families can request a copy of the post-mortem report, though it may only be released after the inquest.

When will the inquest take place?

Inquests are typically held within 6-9 months of a death. During this period, the coroner will:

  • Gather evidence, including medical records and witness statements.
  • Contact the family to explain the process.
  • Potentially hold a pre-inquest review to organise evidence and identify issues.
  • Issue an interim death certificate to allow families to manage practical matters.

What happens during the inquest?

The inquest is a public hearing where evidence is presented to establish the facts of the death. Key participants include:

  • Witnesses, including doctors, police officers, or medical experts.
  • Family members, who may provide personal testimony.
  • Legal representatives, especially in cases involving state bodies.

The coroner may also call for independent expert opinions to ensure a complete understanding of the circumstances.

Conclusion of the inquest

At the end of an inquest, the coroner or jury will deliver a conclusion that falls under one of several categories, including:

  • Natural causes
  • Suicide
  • Accident or misadventure
  • Unlawful or lawful killing
  • Industrial disease
  • Stillbirth

In some cases, a narrative conclusion is given, providing a detailed account of the circumstances surrounding the death.

Legal representation at an inquest

Having legal representation can be invaluable, particularly if there are concerns about the care a loved one received. Our experienced solicitors can help ensure that the right questions are asked, and all relevant evidence is considered.

State bodies are often represented by legal professionals, so having your own solicitor can help provide a balanced and thorough investigation.

Tees sweeps two awards

Tees celebrates double success at Cambridgeshire Law Society Excellence Awards

Tees, the local law firm with offices in Cambridge, Bishop’s Stortford, Royston, Saffron Walden, Brentwood, and Chelmsford, celebrated a double success by winning both the Excellence in Technology and Innovation Award and the Residential Property Team of the Year Award at the Cambridgeshire Law Society Excellence Awards. The awards ceremony was held on Zoom on Friday, 23rd April 2021.

Tees also received a Highly Commended award for Injury Litigation Team of the Year, and Private Client Associate Chris Claxton-Shirley was also Highly Commended as a Rising Star.

Celebrating legal excellence

The Excellence Awards celebrate the legal community of Cambridge across various categories, with winners chosen based on criteria such as excellent client service, technical capabilities, and response to the challenges posed by Covid-19.

Prominent attendees included Stephanie Boyce, President of the Law Society of England and Wales; The Rt Hon Lucy Frazer QC MP, Solicitor General; and Elizabeth Rimmer, CEO of LawWorks, which served as the Charity Partner. The awards ceremony was sponsored by Rathbones Investment Management. The Judging Panel was chaired by Ian Mather and included representatives from Rathbones Investment Management, AstraZeneca, Handelsbanken, Barclays Corporate, and FRP Advisory.

Excellence in technology and innovation award

Clare Pilsworth, Family Partner and newly appointed Head of Tees’ Cambridge office, accepted the Excellence in Technology and Innovation Award.

She said:

“Tees has been investing heavily in technology long before the pandemic hit, and we have continued that investment throughout the past year. Winning this award is a testament to the decisions we’ve made as a firm to be at the forefront of innovation and technology in the region. It also reflects the hard work of our IT team in implementation, integration, and training, enabling our solicitors to provide a seamless client experience.”

Residential property team of the year award

Julia Turner, Senior Associate and Head of the Cambridge Residential Conveyancing Team, expressed her gratitude upon receiving the Residential Property Team of the Year Award.

She said:

“This award means so much to the team. We have worked through unprecedented times, delivering a high quality of service. Our demand has grown substantially, and our success is thanks to the consistent hard work of our team.”

Highly commended injury litigation team

The Legal 500 Tier 1 Injury Litigation Team, led by Partner Janine Collier, was Highly Commended for their outstanding work. Tees provides a wide range of services, including personal injury, medical negligence, and inquest representation, securing settlements from modest to multi-million-pound amounts.

Janine said:

“A personal, tailored client experience is at the heart of our service. Each Tees lawyer has fewer cases than other injury practitioners so that they can truly understand the client’s needs and help them to a better future.”

Rising star recognition

Chris Claxton-Shirley received a Highly Commended in the Rising Star category. He shared his pride in his contributions to the firm and the community.

He said:

“I am proud of the contribution I make to Tees, our local community, and the wider profession. I am excited about what the future holds.”

Reflections from the group managing director

Ashton Hunt, Group Managing Director of Tees, expressed his pride in the firm’s achievements:

“Tees has made significant investments in technology over the past eight to ten years, enabling us to successfully navigate the pandemic while continuing to deliver excellent service for our clients. Continuing to invest in the best technology to support our people remains part of our core strategy, and I am truly delighted that the firm’s efforts have been recognised in this way.”

Advice to young farmers on taking over the family farm

If you’re a young farmer who is in line to inherit your family’s business, taking the farm successfully forward into the next generation can feel overwhelming.

In this guide, we provide you with an overview of the many ways you can prepare yourself to run the family business, embrace new methods of working and protect the farm both legally and financially.

Open up conversations about succession

While talking about money and inheritance can be uncomfortable, it’s important to open up these conversations early on so that everybody’s expectations and positions are clear. Succession planning is important for any family business, but broaching the idea within farming families can be particularly difficult, with the current business owner often reluctant to relinquish control to a successor.

According to a study, less than a fifth of farmers plan to ever fully retire, while only half of those with children have identified a successor. Indeed the UK Government recognises this as a problem, to the extent that it has set up a new scheme to pay older farmers to retire, enabling the younger generation to enter, bringing with them new farming methods and breathing new life into the business.

Even if the current owner of your family’s business has no plans to retire, it’s still important to plan for the unexpected and to ensure that the legal and financial framework has been put in place to enable you to take over the business in the event of their death.

If your parents are unwilling to enter into these types of conversations with you, our rural legal specialists can help you facilitate positive discussions by explaining the benefits of succession planning and assisting with essential aspects of estate planning such as drafting Wills, providing Inheritance Tax (IHT) advice, introducing the possibility of making lifetime gifts and placing life insurance benefits in trust.

Key succession planning questions

If you’re unsure of where to start, here are some good questions you can use to open up productive conversations around succession and the future of the family business.

  • What are your parents’ future plans? Do they plan to retire? If so, can you work with them and take on more responsibility so they are able to slow down in their later years? If not, is there another way for the two generations to satisfactorily work together in the long term?
  • Who will live where? Does the farm have a number of properties which can accommodate the family?  If so, try to have an open discussion with all family members about preferences for the future.
  • What training and skills development do you need to undertake in order to prepare for succession? Your parents may be nervous to hand over the farm if they do not believe you yet possess the skills to take the farm forward successfully.
  • It’s likely your parents will not want to split up the farm, so if you are in line to inherit, what provision will need to be made for your siblings, if you have any?
  • How will your family’s land and business assets be passed down with the minimum Inheritance Tax liability?
  • What role do you, your parents and your siblings want to play, now and in the future? Do your siblings want to be involved in the farm or are they happy for you to take it over? It’s important to nail the details down now to avoid conflict later down the line.

Draw up a partnership agreement

If the farm owner is not ready to retire, but you are still looking to take a more active role in the business in order to develop your knowledge and skills, you may wish to consider a Partnership Agreement.

Having a partnership agreement in place allows clarity regarding the ownership of business assets and enables families to clearly define the roles each partner will play in the day-to-day management of the farming business.  Holding assets within the partnership can sometimes also be a useful tax planning tool.

Our expertise is in helping farming families draft comprehensive partnership agreements, and to advise on any issues that may arise in the duration of the partnership (for example, helping to handle disputes, or managing change within the partnership, e.g. if one of the partners leaves the partnership or dies).

Consider diversifying

Whether they want to or not, many farming businesses are having to diversify and find new and sustainable sources of income to ensure the farm’s survival in the modern era. According to Defra, 66% of farms across the UK have already diversified in some form to provide farming families with the additional income they need and support the rural economy.

This may take the form of using unused outbuildings to set up farm shops or professional services spaces, hosting tourism accommodation, or setting aside land for recreational uses, such as horse riding or golf courses.

Funding a new venture is often expensive, which can prove a barrier to successful diversification. In addition to commercial loans and private finance, you may be able to access funding from initiatives such as the Rural Development Programme for England, which provides money for diversifications that will have a positive impact on the environment.

At Tees, we regularly advise farming families on a wide range of diversification projects, ensuring they meet any new legal and regulatory requirements to which they may become subject in the course of their new venture – for example, planning permission, or the acquisition of special licenses or certificates.

Get familiar with new post-Brexit funding

The EU system of grants and subsidies to British farmers is being phased out from this year and replaced with a new series of Environmental Land Management schemes that reward farming businesses for the provision of ‘public goods’, i.e. implementing more sustainable farming methods or working to restore habitats and the environment.

Understanding the types of initiatives rewarded by the new system will help you guide the business in the right direction and enable you and your family to more effectively plan for the future.

They include (but are by no means limited to):

  • Natural flood management measures
  • Restoring habitats and environments
  • Forest and woodland creation
  • Opening up public access to the countryside
  • Improving soil health
  • Improving air and water quality.

More information about the post-Brexit Environmental Land Management schemes can be found here. The gov.uk website also gives an overview of other grants and payments currently available to agricultural businesses.

Take specialist advice

For many young farmers, the thought of taking over the family farm is exciting, but overwhelming. But you don’t have to do it alone. Our agriculture and estates specialists offer legal and financial services across a broad spectrum of specialisms, including Wills, Trusts, Tax & Probate, Corporate, Commercial Property and Wealth Management.

We have been helping farming families successfully transfer their business from generation to generation for over a century. For advice on planning for your future, don’t hesitate to get in touch.

One farming family, over 30 years of trusted legal and financial advice

For over three decades, Tees has provided expert legal services to multiple generations of the Miller* family, a prominent agricultural family with extensive farming, land and property interests located across several English counties.

Our senior partner and specialist in rural succession and estate planning, Catherine Mowat, has worked closely with the Millers for many years, helping them capitalise on opportunities for efficient estate planning and take advantage of valuable Inheritance Tax reliefs.

Alongside Catherine’s team, our Commercial Property, Residential Property, Commercial and Wealth Management teams have worked together collaboratively in order to help the Miller family effectively manage their business and property interests.

Passing assets on to the next generation

Catherine has worked extensively with the Millers over a number of years to put in place comprehensive arrangements that will enable more senior family members to pass on their assets effectively to future generations, whilst minimising the Inheritance Tax (IHT) payable on their estate.

The family were advised to make substantial lifetime gifts to their children and grandchildren, enabling assets to be passed on to younger generations in a controlled way.

  • How does Inheritance Tax (IHT) work?

IHT is a tax on the capital value of assets (including money, property and possessions) either when somebody has died or on some gifts made during lifetime.  On death, it is generally payable at a rate of 40% on all assets over the value of £325,000, although there are exemptions and reliefs that can be used to lessen the amount due. Another way of reducing the IHT payable on your estate is to make lifetime gifts.  If you make gifts more than seven years before you die, there will usually be no IHT due on these gifts on your death.  If tax does arise, only gifts given less than three years before you die attract the full 40% IHT rate, making lifetime gifts an excellent opportunity for passing on assets to minimise tax.

These lifetime gifts also caused the estate value belonging to the children to rise, increasing their IHT liability. Here, our Wealth team stepped in to help set up suitable life insurance arrangements, written in trust to minimise the impact of a significant tax bill.

  • Why should I write my life insurance policy in trust?

Writing your life insurance in trust is a way to avoid paying IHT on the eventual payout. When you place an asset into a trust, you essentially give up ownership of that asset to the trust and appoint trustees to oversee it (this can be a solicitor, like Catherine, or somebody else). As the assets (in this case, the life insurance policy) don’t officially belong to you, they aren’t classed as being part of your estate and are therefore not subject to IHT.

Catherine has also worked with the Millers to draft essential estate planning documents such as Wills and Powers of Attorney, and acts as a trustee for the various trusts within which the family’s business and property assets are held. Her many years spent advising this family have enabled her to build a strong relationship with the Millers, bound by mutual trust and respect.

Taking advantage of Inheritance Tax (IHT) relief

Over the years, our Wills, Trusts and Probate team has worked closely with the Millers to ensure their entitlement to valuable IHT reliefs. For example, Catherine’s advice has enabled the family to take full advantage of Agricultural Property Relief (APR) on their eligible assets.

  • What is Agricultural Property Relief (APR)?

APR allows farming families to pass on agricultural property at a reduced or 0% rate of IHT, either during a person’s lifetime or in their Will. To apply for APR, the land or property must have been owned for at least seven years, or occupied for two years and must be used for growing crops or rearing animals, or take the form of farm buildings, cottages or houses. It does not apply to farm equipment or machinery, derelict buildings, harvested crops or livestock. APR can be due at 100% or 50%, depending on the circumstances.

Catherine also regularly reviews the balance of the Millers’ business activities to ensure that no entitlement to Business Relief (BR) is lost, by using the ‘Balfour’ test.

  • What is Business Relief (BR)?

BR allows business owners to pass on certain business assets at a reduced or 0% rate of IHT, either while they are still alive or via their Will. The owner must have owned the assets for at least two years before they died for them to be eligible. BR is due at 100% for:

  • A business, or interest in one
  • Shares in an unlisted company

It is due at 50% for:

  • Shares controlling over 50% of the voting rights in a listed company
  • Land, buildings or machinery owned by the deceased and used in a business in which they were a partner or controlled
  • Land, buildings or machinery used in the business and held in a trust the business has the right to benefit from

To be eligible for BR, a business must also be classed as a predominantly trading business. However, many farms are becoming increasingly diversified, with activities such as cottage rentals and holiday lets shifting the balance from trading to investment.

Catherine used the Balfour test to assess the Millers’ farming business and used the results to advise the family on achieving the best balance between trading versus investment activities within the farming partnership for BR purposes.

Strategic land and property solutions

Our Commercial Property team regularly steps in to assist the Miller family in matters relating to the lease or sale of land and properties, which include a range of sites with commercially let units, and other strategic deals such as granting options. Rural specialists within our Commercial Property team will negotiate and facilitate these various land transactions.

An example of the type of planning advice we offer might be in relation to land owned by a family trust on which planning permission has been obtained for development. In this situation our Corporate team would step in to advise on the incorporation of a ‘freezer’ company.

The team would also prepare bespoke articles of association, ‘freezing’ the value of certain interests in the company in order to cap ownership. This ensures that the growth and value of the land will be passed on to the next generation tax-efficiently and limit their IHT liability.

  • What is a ‘freezer’ company?

Also known as a family investment company (FIC), a ‘freezer’ company is essentially a private limited company whose shareholders are all family members. Commercial solicitors can help the family prepare bespoke articles of association that set out the rights and interests each party holds within the company. For example, the parents can set themselves up as voting shareholders – thus maintaining control over the company – but ‘freeze’ the value of their interests in the company to cap their ownership.

Meanwhile, the children can be non-voting shareholders but own the majority of the shares, allowing the growth and value to pass on tax-efficiently to the next generation. This makes ‘freezer’ companies an ideal vehicle for intergenerational wealth management, allowing assets to be passed on during your lifetime whilst still retaining control of them. If you live for more than seven years after setting up the company, no IHT will be due (according to the rules of lifetime gifting).

A full- service firm rural families can depend on

For over a century, Tees has been a trusted partner to farming families like the Millers, helping them pass the family business from generation to generation. In this time, our agricultural specialists have developed a unique understanding of the challenges facing the rural community.

From tailored business advice to passing your land and assets tax-efficiently to the next generation, our specialist agricultural lawyers can help you navigate the complex relationship between business, land and family interests.

*Please note that the family’s name has been changed for anonymity. 

Flair Showers Limited acquires London-based luxury shower business

Essex-based premium shower screen designer and manufacturer MSCLUK Ltd (Majestic) has been acquired by Flair Showers Limited (Flair). The deal, that completed on 15 January 2021, was supported by Tees Law Corporate team and FRP Advisory.

The long-standing family firm and client of Tees Law, whose products feature in luxury hotels and residential developments across London and the South East, will now become part of Ireland’s oldest manufacturer of shower doors and bath screens. The deal is expected to generate significant growth opportunities for both businesses, with Majestic’s second-generation management team to remain in place.

Tees Law’s Corporate team advised on the deal, which allowed Majestic to build on its more than 50-year history and enabled Flair to see the potential to grow the business and expand on its excellent reputation and product range. Working closely with the management team at Majestic, Tees Law, and FRP Advisory, secured a deal that met the shareholders’ expectations, with upside structures included for management to benefit from future growth.

Tom King, Managing Director of Majestic said: “We had a great experience from start to finish, I found Charles and Abigail offered clear and understandable legal advice, with both fully cognisant of the commercial drivers behind the deal. They explained legal risk in an easy to understand way and were willing to put the hard work in and correspond even at the most antisocial times.” 

Lucy Folley, Partner and head of Corporate at Tees Law, said: “In addition to the uncertainty surrounding COVID-19 and Brexit, this was a complex and time-consuming transaction due to our client being set up as a result of a pre-pack administration, yet Charles and Abigail were able to offer detailed and timely advice to one of our long-standing clients.  They have been extremely happy with our work and we wish them the best going forward.”  

Dave Howes, Corporate Finance Partner at FRP, said: “Despite the ongoing uncertainty relating to the COVID-19 pandemic and the nascent impact of Brexit, this deal puts both businesses in a strong position to further the excellent reputation and range of products they have developed for more than half a century. Martin Murphy and the team at Flair Showers were quick to recognise The Majestic Shower Company’s potential for growth and I look forward to seeing it thrive with their support.”

Newborn baby boy’s death due to hospital neglect

An Inquest conducted by the Hertfordshire Coroner Service has concluded that aspects of the events leading up to the sad death in hospital of Eddie Coffey, a one-day-old baby boy were so unsatisfactory that they amounted to neglect.

The hearing at Hatfield learned that Eddie Coffey had died in the neonatal intensive care unit at Luton & Dunstable Hospital on 14 January 2019, having been transferred from the Lister Hospital in Stevenage due to major complications following his birth there the previous night.

Eddie’s 30-year-old mother, Hannah Coffey from Hoddesdon, already had a two-year-old child and was seven weeks pregnant with Eddie when, on 29 May 2018, she was assessed by the Lister Hospital as low-risk as regards antenatal care.

In August, Hannah’s history was reviewed during her visit to the hospital’s Consultant Clinic. She was already taking aspirin in view of raised blood pressure during her earlier pregnancy and she was to have third-stage active management with regular blood pressure checks from 24 weeks.

Delivery

On 13 January 2019, Hannah experienced contractions and was admitted to the midwifery-led unit at the Lister. Initial monitoring at 1815 showed that the fetal heart rate was within the normal range and it remained so for over four hours as contractions became more frequent.

At 2240, a large deceleration in heart-rate was noted and the Lister’s Consultant-led unit (CLU) was informed of this. Minutes later, Hannah was transferred to the CLU and a cardiotocograph (CTG) was commenced to monitor fetal heart rate and contractions.

Over the next 10 minutes fetal heart rate was recorded as within normal range, and birth was imminent, so a request for the Registrar to attend was cancelled. Eddie was delivered just before 2330, but his condition was concerning.

Resuscitation

The emergency buzzer was used to call for resuscitation and the neonatal team took over, with the Locum Registrar on call for Paediatrics attending.

Resuscitation was provided using an IPPV ventilator, with cardiac compression, until ETT intubation was ready at 2350. Eddie’s heart rate then fell further, prompting re-intubation with a narrower tube, and his heart rate improved.

At around midnight, the Neonatal Consultant arrived and tests of venous gas indicated metabolic acidosis, a serious electrolyte disorder. Eddie was transferred to the neonatal intensive care unit (NICU), where fluids and medication were administered while ventilation continued.

Suspecting hypoxic ischemic encephalopathy (HIE), a brain damage, the consultant arranged transfer to the NICU at Luton & Dunstable Hospital for possible therapeutic hypothermia treatment. Baby Eddie was transferred there in the early hours but sadly died later that day.

Cause of death

A post-mortem at Great Ormond Street Hospital found that the cause of Eddie’s death was perinatal asphyxia.

A Serious Incident Investigation by East and North Hertfordshire NHS Trust followed. The investigation report concluded that at a crucial time in the proceedings the CTG appeared to have recorded the mother’s heart rate, not the baby’s, thus preventing recognition of fetal hypoxia. This was likewise the opinion of independent expert evidence heard by the Coroner such that earlier identification of Eddie’s condition would have improved his outcome.  Such a failing, the Coroner found, amounted to neglect.

“Correct, effective use and interpretation of a baby and mother’s heart rate is helped by a CTG machine but it still needs to be interpreted responsibly and then appropriately acted upon. Here the Coroner determined on all of the evidence that it was neglect to fail to provide such basic care to Eddie and that this may have avoided such a tragic outcome,” said specialist medical solicitor Tim Deeming of Tees Law, acting for parents Hannah and Thom Coffey. “The inquest has been very challenging for the family and whilst we understand that the Lister have been looking to improve, we want to ensure that this does not arise for any other family, especially given the findings from the national Each Baby Counts review and the concerns raised around such preventable outcomes.”

Hannah’s concern for others

“Saying goodbye to our beautiful boy only hours after he had been born has left us all with a hole in our hearts from which we will never recover,” Hannah Coffey reflects.

“Not for a moment did I imagine that we could arrive at hospital with a healthy baby and leave without him in our arms. Like many expectant parents we put our trust in the care we would receive. 

Knowing that a lack of competence in the use of vital medical equipment could affect other families in a similar way is driving us to raise awareness of the need to ensure proper training and use of equipment to help save the lives of other babies.”

Norfolk boy died from undiagnosed bowel condition after surgery delay

Norfolk Coroner’s Court has issued its conclusions in the tragic case of an eight-year-old boy from Harleston, noting that the gravity of the child’s condition and the need for surgery were not recognised by paediatric staff at the Norfolk & Norwich University Hospital.

The inquest had heard that Charlie Goodwin died at Addenbrooke’s Hospital, Cambridge, on 6 September 2019, following a move from Norfolk & Norwich, where emergency surgery had been conducted hours earlier.

In her written statement for the Coroner, Charlie’s mother, Nicola Goodwin, explained how the happy, football-mad youngest of her six children had been seemingly healthy until a vomiting episode in December 2018 followed by abdominal pains and prolonged loss of appetite.

Early in 2019, Charlie’s abdomen became distended, and the family’s GP shared his mother’s concern about this at a March 2019 consultation. Blood tests ruled out food intolerances, so further investigations began at Norfolk & Norwich University Hospital.

Concerned about worsening abdominal pain and uneaten school lunches, Nicola sought an early hospital appointment, and Charlie was seen at Norwich on 18 July and given an abdominal X-ray. The report showed large bowel dilatation, which Nicola discovered could be due to a blockage.

No follow-up hospital appointment was forthcoming, but on 25 July, Nicola took Charlie to the nurse practitioner because he was feverish with possible symptoms of a urinary infection. The nurse suggested heatstroke as the likely cause.

Symptoms intensified

Over the next few days, Charlie’s symptoms intensified, and a call to NHS111 prompted a visit to the local Beccles Hospital. Checks found nothing wrong, as did a subsequent doctor’s appointment, at which a urine sample was taken and antibiotics prescribed as a precaution.

When Charlie’s temperature hit 40.5oC the next day, and his abdominal pain became severe, Nicola suspected a blockage and took him straight to A&E, where checks for infection were negative and examination by several doctors also found nothing, so he was discharged.

Fever and pain on 2 August led Nicola to take Charlie back to Norfolk & Norwich, where a children’s emergency doctor suspected meningitis, ordering a head scan and lumbar puncture. The radiologist refused a scan, doubting the necessity, but Charlie was admitted later that day.

Overnight on 4 August, the paediatric surgeon was called; he noted Charlie’s distended abdomen and ordered an abdominal X-ray and MRI scan, though the scan never happened, and Nicola was not told why. A heart scan was done and revealed a slight murmur, but no action followed that.

‘Medical mystery’

Inconclusive abdominal ultrasounds were also taken, though Nicola learned weeks later that malrotation meant Charlie’s intestines had not formed properly.  Some blood tests but no further scans were carried out before Charlie was discharged on 7 August, described as ‘a medical mystery’.

Pain and lack of appetite continued, and on 14 August, Charlie had a barium swallow test, ordered earlier, which produced a ‘normal’ result but did not cover all of the bowel. A urodynamics test followed for continence issues, which Nicola suspected were linked to the other symptoms.

Charlie returned to school in September but was not eating his packed lunches. On 5 September, he also left his dinner and began vomiting, though with nothing to bring up. A 999 call, prompted by Charlie screaming out in pain and vomiting, brought only an instruction to use her GP or out-of-hours surgery.

Charlie vomited repeatedly and continued to scream, groan and writhe in pain when driven instead to Norfolk & Norwich A&E, which sent him straight to the Children’s Emergency Department. His temperature and blood pressure were very low, and his heart rate was very high. He was put on intravenous fluids, and a surgical review was sought, but the paediatric surgical registrar was already busy.

Despite Charlie’s presentation and a doctor’s request for urgent surgical review at around 22:15hrs, it was not until midnight that the paediatric surgical registrar reviewed Charlie, noting that there was no need for surgical intervention and put forward a plan for conservative treatment. Charlie’s situation worsened throughout the night, several further requests for surgical assessment were made, and hours later, at 2am following escalation to the paediatric surgeon, the surgeon examined Charlie’s enlarged, hard, blue tummy and declared that urgent exploratory surgery was needed as the cause was unclear.

During the preparation for surgery, Nicola exclaimed that Charlie’s pupils were dilated, and a nurse found them unresponsive. Administering oxygen brought a brief reaction, but a doctor sounded the emergency alarm, and Nicola had to leave.

Cardiac arrests

A little later, a nurse came to tell a stunned Nicola that Charlie’s heart had stopped and they were responding to that. Despite two cardiac arrests, the plan for surgery stood, but Nicola was told that her very sick son might not make it.

Charlie went to the theatre at 5 am and an hour later was in recovery, a doctor telling the family he had intestinal malrotation causing a twisted bowel. Later that morning, they were told he would be transferred to the paediatric intensive care unit (PICU) at Addenbrooke’s Hospital.

A third cardiac arrest occurred as Charlie was switched to the children’s ambulance equipment, another while switching at Addenbrooke’s and a fifth after arrival in the PICU. The family were told further CPR would mean no quality of life due to brain damage and multiple organ failure.

At the bedside, the distressed family witnessed blood pouring first from Charlie’s operation wound and then his nostrils. His parents made the agonising decision not to resuscitate him after his next cardiac arrest and were there when he sadly died at 6.20 pm on 6 September.

“There were missed opportunities to give young Charlie Goodwin the timely and appropriate medical treatment that his intestinal malrotation required,” asserts specialist solicitor of Tees Law, acting for the bereaved Goodwin family.

“The final opportunity was at the Norfolk & Norwich University Hospital on that fateful evening in September last year. Prompt and effective emergency surgery could possibly have averted the catastrophic outcome that followed a delay of several hours.”

“The assessment by the paediatric surgical registrar was not acceptable, based on the clinical circumstances,” Tees law explains. “The paediatric surgical registrar did not recognise the severity of Charlie’s illness, and this error delayed the treatment, which could have saved Charlie’s life.

“Following the sad outcome, the hospital’s medical director requested an ‘invited clinical record review’ of the case by the Royal College of Surgeons. The RCS report dated 29 June 2020 formed an important part of evidence for the inquest Coroner.”

NHS Trust accepts RCS findings

The RCS review team investigated various aspects of Charlie’s treatment. Their report made recommendations to address patient safety risks and aspects of the case that pointed to a need for service improvements.

The review team was concerned about the six-hour gap before Charlie was seen by a consultant on the evening of his emergency admission on 5 September 2019. They recommended that:  “To facilitate service improvement and reduce the possibility of a similar tragic, catastrophic incident, the Children’s Early Warning Score (CEWS) is reviewed and may be refined by the addition of information from blood gas (lactate) analysis to trigger an automatic senior review escalation.”

Other recommendations for action by the Trust to improve service included undertaking a review of the out-of-hours junior staff cover for paediatric surgery, reassessing the adequacy of facilities for critically ill children in the Children’s Emergency Department at Norwich, and ensuring that information in clinical notes avoids judgmental language and remains factual.

Having received and read the RCS report, on 30 June, the Trust’s medical director sent Charlie’s parents a copy with a letter expressing sincere and heartfelt apologies and condolences and assuring them that the Trust accepted the review conclusions in full and was working hard to address them.

The letter also said, “The key conclusion that stands out to me, and I am sure it will to you also, is that the assessment made of Charlie on 5 September 2019 by the paediatric registrar was not acceptable and that there was a missed opportunity to discuss Charlie’s care in a more urgent manner with the paediatric consultant. The investigation has concluded that had there been a more urgent response, there may have been an opportunity to save Charlie’s life.”

Life could have been saved

This position was reiterated on the Trust’s behalf during the current hearing by the consultant paediatrician, who agreed that the paediatric registrar’s assessment was unacceptable and acknowledged that ‘the level of care we normally provide and that Charlie deserved was not provided that night’.

Under questioning by Counsel, the consultant accepted that the registrar failed to recognise the severity of Charlie’s illness as evidenced by blood gases, delaying by several hours emergency surgery that could have saved his life, particularly if he had been taken to theatre before his first cardiac arrest.

Inquest Conclusions

The Coroner’s conclusions were: “Charlie had a history of abdominal distension and vomiting. He had several admissions to hospital and underwent extensive examinations and tests. He was admitted to Norfolk and Norwich University Hospital on 5 September 2019 presenting as very unwell and in shock. During late 5 September 2019 Charlie was reviewed from a surgical perspective, and the gravity of Charlie’s condition and the need for surgery were not recognised. Surgical advice was not sought from the on-call Consultant.

“Charlie’s condition deteriorated further, and it was not until it was re-escalated to the medical team that the need for surgery was recognised. Charlie did not undergo surgery until the early hours of 6 September 2019, when an emergency laparotomy was performed. Charlie’s condition remained serious. Later that day, he was transferred to Addenbrooke’s Hospital, where his condition continued to deteriorate, and he died. Charlie Goodwin died from a rare and undiagnosed bowel malrotation and midgut volvulus.”

Under her Regulation 28 duty to prevent future deaths, the Coroner has noted that she will write to the General Medical Council, inviting them to have a recording of the inquest and informing them that they may wish to investigate the paediatric surgical registrar’s evidence and fitness to practice.

Having heard the Inquest outcome, Tees Law said, “Had Charlie been assessed properly, it is likely that he would have been taken to surgery much earlier, well before his condition deteriorated further and he suffered from a cardiac arrest. Had that been the case, Charlie’s chances of survival would have been much greater, and it is likely that his life would have been saved.”

Tees Law added, “Charlie’s mum Nicola and the whole family are desperate to ensure this never happens to anyone else. They are devastated by the loss of their wonderful, incredibly loving and funny son and brother. They want to raise general and medical awareness of this rare condition and hope to do so in Charlie’s memory.”

Bright graduate died after GP practice dosage error

West Sussex Assistant Coroner Ms Henderson has concluded an Inquest into the tragic death of a 30-year-old man who had been receiving medication for severe back pain at a village medical practice. It points to shortcomings in the treatment given by the practice in Loxwood.

This week’s hearing and an adjourned hearing at Crawley in January learned that Leeds University graduate Hamish Hardie died in August 2019 at the family home in Wisborough Green from an accidental overdose of prescribed painkillers, for which the dosage label was unclear.

Hamish required pain relief for severe back pain caused by two prolapsed lumbar vertebral discs, for which he was waiting for private surgery, and was dealt with at Loxwood by a qualified doctor who was in his final year of GP training under the supervision of a senior GP.

Dosage not specified

The doctor prescribed two opiate painkillers, Dihydrocodeine and Oramorph, as well as the relaxant Diazepam. The prescription for the Oramorph on the label tragically said it should be taken as directed, which was unclear. Sadly, this was also not identified by the dispensing practitioner within the pharmacy at the practice.

Hamish’s mother Mary-Anne took responsibility for administering the medication, but the uncertainty about the Oramorph label and reliance on Hamish for dosage details meant that more frequent and higher doses were given.

Sadly, Hamish died two days later and a post-mortem confirmed that the primary cause was a prescription drugs overdose, which the Coroner concluded was accidental. The trainee and supervising GPs did not recall seeing an alert on the medical records and the computer system meant that with an Oramorph prescription its labelling default standard was ‘use as directed’.

“We still feel that Hamish was badly let down that day and that his life was unnecessarily cut short by medical failings,” Mary-Anne Hardie reflects. “It was May 2019 when Hamish developed back pain from a suspected slipped disc. That was confirmed on an A&E visit in June, when he was given Diazepam and put on the list for a possible operation. We are disappointed that the GPs did not see the alert on the computer and that if the labelling and prescription advice had been clear, or the pharmacy had spotted the inconsistency, then we feel that Hamish would still be here as he was looking forward to job interviews and a new chapter in his life.” 

A ‘perfect storm’

Specialist solicitor Tim Deeming of Tees Law adds: “The Coroner described this as a perfect storm and it is tragic that the GPs did not know that the labelling system defaulted, and that the pharmacy did not then spot this.

“While we are glad to know that the Loxwood Medical Practice has made significant changes to procedures following Hamish’s death we all hope that the NHS and GPs will take steps when providing such prescriptions to provide clear guidance on use, as well as checking computer systems to ensure that other families do not have such devastating outcomes.” 

What is pension drawdown and how does it work?

Pension (or income) drawdown is one of the ways you can use your pension pot to provide a regular income when you reach retirement. Drawdown is a flexible way of accessing your pension, while allowing your pension fund to keep growing. Here, we explain exactly how drawdown works and whether it’s right for you.

Pension drawdown is available to those aged 55 or over (increasing to age 57 in 2028) and enables you to take an income from your pension pot while leaving your remaining pension savings invested.

You can choose to move your pension into drawdown in one go or a little at a time. You may be able to do this with your current provider or by transferring your pension to a drawdown provider elsewhere. If you decide to transfer, it’s important to first check you won’t lose any valuable benefits or be charged high exit fees.

Under rules introduced in April 2015, you can take up to 25% of your pension pot you use for drawdown as tax-free cash – you can take this in one go or each time you move part of your pension into drawdown. Further withdrawals can then be made as and when you choose, whether you do this in one go, take regular monthly payments, or withdraw lump sum payments as and when you need them.

Drawdown allowances and tax rules

The first 25% you take of your pension pot will be tax-free, while the remaining 75% will be subject to Income Tax. How much you pay will depend on your total income for the year and your tax rate. For 2020/21 this means:

  • if you have no other income, no tax will be due on the first £12,500
  • on income between £12,501 and £50,000 you’ll pay tax at 20%
  • on income between £50,0001 and £150,000 you’ll pay tax at 40%
  • on income over £150,000, you will pay tax at 45%.

What are the benefits of drawdown?

One of the biggest advantages to drawdown is the flexibility it offers. Not only does it enable you to take money from your pension savings whenever you need it, there’s no limit on the number of withdrawals you can make, and you can take out different sums each year.

At the same time, the remainder of your pension pot can stay invested which means if your investments perform well, your income could grow throughout retirement. Drawdown gives you the option of being able to choose your own investments, use ready-made portfolios or let an adviser choose on your behalf.

What are the downsides?

It’s important to understand that it’s your responsibility to ensure your retirement income lasts the duration of your retirement and to understand that the more you withdraw from your pension pot, the quicker it will be depleted. If you make withdrawals too frequently, your retirement income could run out earlier than expected.

Consider, too, that large withdrawals can push you into a higher tax band and, as soon as you withdraw more than your 25% tax-free lump sum, the Money Purchase Annual Allowance (MPAA) applies which limits the amount that be contributed to your pension to £4,000 per year.

Additionally, there’s no guarantee that your investments will continue to grow which means you could get back less than you invest.

Buying an annuity is still appropriate for many people in retirement as it allows you to use your pension savings to buy a guaranteed income that lasts the rest of your life. If you prefer, you can use part of your pension savings to buy an annuity and leave the remainder in drawdown.

How to manage drawdown funds during retirement

If you’re considering drawdown, it’s important to plan carefully, taking into account how long you need your pension to last – remember that your retirement could last 30 years or more. As part of this, you’ll need to consider what to do with any cash you withdraw over the short, medium and long-term:

Short-term: when still in employment, it’s advisable to keep three to six months’ worth of income in a current account or savings account that will give you instant access for covering emergency costs. Upon retirement, this should increase to one to three years’ worth of expenditure.

Medium-term: cash that’s not required in the immediate future could be tied up in a fixed term savings account as these tend to pay higher interest rates than you’ll get with an easy access account. In return, you must leave your funds untouched for the term of the account, which could be anywhere between six months and five years. As a general rule, the longer the term of the account, the higher the rate of interest. You could choose to lock some cash away in a shorter-term account, and another chunk in a longer-term one.

Long-term: investing can be a good option for any cash you won’t need to use for longer than five years. Investing in the stock market tends to give better returns than cash savings over the long-term but remember that your investments can fall in value as well as rise, so you should ensure you understand the risks involved first.

Key questions to consider

Before deciding whether pension drawdown is right for you, it’s worth asking yourself the following questions to ensure you fully understand your options:

  • How much of my pension do I want to move into drawdown?
  • Will I be charged an exit fee if I transfer my pension?
  • Am I comfortable managing my retirement income or would a guaranteed income be more suitable?
  • How regularly should I make withdrawals?
  • Am I comfortable with the investment risk and do I have other income to fall back on?

How we can help

Should you need help answering these questions, our expert pension advisers are on hand to discuss all your pension and retirement options. We take a holistic approach tailored to you, the individual, and will always make alternative suggestions if appropriate.

Our advisers will talk to you in jargon free language to help you understand your choices and our advice and recommendations will be focused on helping you to get the best possible result.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.

 

This material is intended to be for information purposes only and is not intended as an offer or solicitation for the purchase or sale of any financial instrument. It is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. Past performance is not a reliable indicator of future returns and all investments involve risks including the risk of possible loss of capital. Some information quoted was obtained from external sources we consider to be reliable.

Tees is a trading name of Tees Financial Limited which is authorised and regulated by the Financial Conduct Authority. Registered number 211314.

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