Structure Lab

It sells a trading company: the second trading company if you've added one, otherwise your original trading company. The buyer appears above it and, with a holding company, the cash arrow runs to HoldCo. The tax card describes the substantial shareholding exemption, which needs the company sold to be trading. Selling a property or investment company is a different exercise, because those companies are unlikely to pass the trading test on their own.

'Split it up' shows a demerger, where the shareholders end up owning two holding companies side by side. The Lab keeps the trading companies under HoldCo 1 and moves the investment and property companies under HoldCo 2. If you've only added a second trading company, it splits the two trades instead. It needs a holding company and at least one other company to split; without them it tells you there's nothing to split yet.

Only which steps you've switched on: whether there's a holding company, a second trading company, an investment company or a property company, and which outcome you picked. These are short codes in the page address. There are no figures, names or personal details in the link, because the Lab doesn't ask for any. Anyone who opens the link sees the same diagram and tax points. 'Start again' clears your choices and the address.

Corporation tax limits are shared between companies under common control, whether or not there's a holding company. If you own two or three companies personally, each one's £50,000 and £250,000 limits are divided by the number of companies. The Lab shows this so you can see that adding a holding company over sister companies may change less than you expect. A holding company counts too, unless it's a passive holding company under s18F CTA 2010.

Each card is tagged by the kind of point it makes. 'Benefit' marks something the structure can do for you, such as tax-free dividends up to the holding company or group relief for losses. 'Watch out' flags a cost or risk, such as reduced corporation tax limits or investment activity affecting reliefs. 'Good to know' covers neutral points, such as how a sale or Business Relief works. Every card links to the page that explains the rule in more depth.

Because surplus cash and investments can count against the trading status that BADR, the substantial shareholding exemption and Business Relief depend on. HMRC treat non-trading activity above about 20% as substantial for BADR and SSE, and a group is judged as one business, so moving cash into a subsidiary doesn't take it out of the test. A company mainly holding portfolio investments is also usually a close investment-holding company, paying 25% corporation tax on all its profits.

No. The Structure Lab works without figures, so it shows the rules that apply to the shape you've built rather than amounts. The one number it gives is each company's corporation tax limits after sharing them between associated companies. For figures, use 'Is a holding company worth it?' for the yearly effect of keeping profits in a holding company, the associated companies calculator for corporation tax, and the sale structure comparison for a sale.

Not in the Lab. It assumes the holding company owns all of each subsidiary, and that the same shareholders own the holding company in the same proportions as they owned the trading company. Ownership levels matter: capital gains groups and group relief need 75%, SSE needs at least 10%, and association turns on control. With outside shareholders in a subsidiary, a joint venture or different share classes, the general points may help, but the conditions need checking on your figures.

It shows profits moving from the trading company to the holding company as dividends. Dividends from a UK subsidiary the holding company controls are normally exempt from corporation tax, so cash can leave the trading company's risk without being paid to you. Income tax arises only when the holding company pays dividends to its shareholders, at 10.75%, 35.75% or 39.35% in 2026/27 after the £500 allowance. The arrow is hidden for 'Sell everything' and when 'Split it up' divides the group.

Inserting a holding company means swapping your trading company shares for holding company shares. For shares issued on or after 26 November 2025, the capital gains relief for that exchange is subject to a main purpose test, and the exchange can also raise income tax questions under the transactions in securities rules. One combined application under s138 TCGA 1992 and s701 ITA 2007 asks HMRC to confirm both in advance. HMRC reply within 30 days, so it shapes the timetable.

The Lab treats the property company as a sister company you own personally. Moving premises out of the trading company to it is normally treated as a sale at market value, because the companies are connected, so there can be a chargeable gain in the trading company and SDLT for the property company. Inside a 75% group, the property can usually move at no gain and no loss with SDLT group relief, subject to clawback if a company leaves the group within 3 or 6 years.

It adds a family company, shown as a family investment company (FIC) or a trust, between your family and the rest of the structure. Parents can keep control through voting shares while children hold shares that take future growth. The Lab also shows Business Relief from inheritance tax under the rules from 6 April 2026: 100% relief on the first £2.5m of qualifying business and agricultural property per person and 50% above. The settlements rules, CGT and inheritance tax all shape the design.

With a holding company, the buyer acquires your holding company shares and you pay capital gains tax, with Business Asset Disposal Relief at 18% possible on up to £1m of lifetime gains if, for two years, the group has been trading and you've met the conditions. Without one, you sell each company's shares yourself, all sharing that single £1m limit, and any company that isn't trading won't qualify. If you've added property or investments, the Lab also asks whether a buyer will want them.

Yes, if it fits the Lab's building blocks: one holding company with your trading company and up to one each of a second trading company, an investment company and a property company. Many owner-managed groups look like that. If yours has several layers, more trading subsidiaries, overseas companies or part-owned subsidiaries, build the nearest version and note what's different. The general points still apply, but details such as which companies are associated or in a 75% group need checking.

Yes. Click 'Copy a link to this structure' and paste it into an email or your enquiry. Whoever opens it sees exactly the diagram and points you saw, which is a quick way to show where you are and where you'd like to get to. Add a few lines on profits, values and your timescale, and a Chartered Tax Adviser can review it against your real figures and history. We respond the same working day.