Lifetime gift on creation of company?

Trusts Discussion
1

Apologies in advance if this is a silly question.

I have a client who works in the medical profession and has a private practice separate from his NHS work. Up until a couple of years ago, that private practice was as a sole trader.

Then he created a limited company with himself, his wife and his children as the shareholders, and since then the money from his private practice has been paid into the company.

At the time of creating the company, no assets were transferred to it. The business is essentially the client and his expertise.

Does this mean that, on creating the company, the value of the gifts made to the children is simply the nominal value of the shares?

Many thanks

2

I may be answering my own question here, but presumably the loss to the estate principle cannot apply to his future earnings? i.e. those received after the company was set up

3

Yes. On the assumption the company balance sheet was Nil at the time of the gift the value would be the par value of the shares example £1.00.

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