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07 June 2011
Issue: 4307 / Categories: Forum & Feedback
A father and three children are directors of a limited company. It is proposed that should the father predecease his younger wife – stepmother to the children – the company should provide her with rent-free accommodation

Our client is a successful very profitable limited company. The directors are the father and his three children who are also our personal tax clients.

The father has remarried. His new wife now the children’s stepmother has no connection to the company whatsoever.
The age difference between the father and his new wife means that he is most likely to predecease her.

The company’s financial accountant has proposed that following the demise of the father the company will pay for the rental of a flat for the widow with no repayment required from her – effectively a rent-free situation to her for the rest of her life.

The stepchildren would have no presence within the property other than social visits. The financial accountant who is adamant that there would be no reportable benefits...

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