- Vast differences in tax paid for generational transfers across 57 jurisdictions
- More than half of the jurisdictions analyzed offer substantial tax breaks
- List of jurisdictions that impose the highest tax rates for transfer of a family business valued at EUR10 million versus EUR100 million
- Emerging trends and factors driving succession, investment, and planning for today鈥檚 business families.
Highlights include:
Toronto, 28 February 2023: For many business families, sustaining prosperity for the long run depends on how well they plan for transfers of business assets and family wealth from one generation to the next, according to the 乐鱼（Leyu）体育官网 Private Enterprise Global Family Business Tax Monitor. The report advises business families with footprints in multiple jurisdictions to monitor potential new or increased taxes and consider taking action in advance.
The report has been a go-to source for family business tax planning for almost a decade, comparing the vastly different tax liabilities among jurisdictions on the transfer of family business through gifting during the owners鈥� lifetime (including on retirement) and through inheritance.
Among the 57 jurisdictions covered in the report, some have geared their tax policies in ways that recognize how a thriving family business sector contributes to a vibrant economy. Others give no special tax exemptions for intergenerational family business transfers, increasing tax costs and likely reducing the family鈥檚 ability to compete with business families in more tax-friendly jurisdictions.
鈥淟ocation can make a world of difference! Tax-efficient transfers between generations can leave wealth in the hands of entrepreneurial families to invest in profit-producing activities 鈥� and that can help stimulate job creation and innovation for future generations,鈥� says Tom McGuiness, Global Leader, Family Business, 乐鱼（Leyu）体育官网 Private Enterprise, 乐鱼（Leyu）体育官网 International
乐鱼（Leyu）体育官网 Private Enterprise鈥檚 report found that globally, South Korea, France, the US and the UK impose the highest tax rates for transfer of a family business valued at EUR10 million by inheritance, before any tax breaks are accounted for. After exemptions, South Africa takes the biggest bite from family business inheritances valued at EUR10 million, followed by Canada and Japan. For inheritances of family businesses over EUR100 million, the most expensive taxing jurisdiction is South Korea after exemptions, with South Africa and the US coming in second and third.
For transfers during the owner鈥檚 lifetime (gifts) of family businesses valued at EUR10听million, Venezuela imposes the highest taxes globally before exemptions, followed by Spain, South Korea and France. After exemptions, South Africa and Japan come second and third behind Venezuela as the jurisdictions imposing the highest tax costs on business transfers by gift. These comparisons are similar for family businesses valued at EUR100 million before and after exemptions.
Top priorities for today鈥檚 business families
The report also provides insights on what business families consider their biggest priorities and risks and calls attention to three emerging trends 鈥� branching out, building up and giving back. The trends crucially reveal an increase in business families and their assets becoming more global, a rise in the importance of governance and a renewed focus on the management of family wealth and the notion of giving back with philanthropic activities commanding more time.
鈥淎mid rising geopolitical tension and unparalleled economic uncertainty, the leading business families that we work with are diversifying globally and putting more focus on the sustainability of their businesses, their wealth and their communities,鈥� says Tom McGuiness, Global Leader, Family Business, 乐鱼（Leyu）体育官网 Private Enterprise, 乐鱼（Leyu）体育官网 International. 鈥淏y doing so, they can position their families for sustainable success down the generations. As a result, we are seeing more business families around the world that are focused on branching out, building up and giving back.鈥�
Download the report for more.
For more information, contact:
Daniel Caines, Senior Manager, Global External Communications, 乐鱼（Leyu）体育官网 International
T: +44 7732400262
E: Daniel.Caines@kpmg.co.uk听 听
About 乐鱼（Leyu）体育官网 International
乐鱼（Leyu）体育官网 is a global organization of independent professional services firms providing Audit, Tax and Advisory services. 乐鱼（Leyu）体育官网 is the brand under which the member firms of 乐鱼（Leyu）体育官网 International Limited (鈥溊钟悖↙eyu）体育官网 International鈥�) operate and provide professional services. 鈥溊钟悖↙eyu）体育官网鈥� is used to refer to individual member firms within the 乐鱼（Leyu）体育官网 organization or to one or more member firms collectively.
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About the 乐鱼（Leyu）体育官网 Private Enterprise Global Center of Excellence for Family Business
As with your family, your business doesn鈥檛 stand still 鈥� it evolves. Family businesses are unique and 乐鱼（Leyu）体育官网 Private Enterprise family business advisers understand the dynamics of a successful family business and work with you to provide tailored advice and experienced guidance to help you succeed. To support the unique needs of family businesses, 乐鱼（Leyu）体育官网 Private Enterprise coordinates with 乐鱼（Leyu）体育官网 firms from around the world that are dedicated to offering relevant information and advice to family-owned companies. 乐鱼（Leyu）体育官网 Private Enterprise understands that the nature of a family business is inherently different from a non-family business and requires an approach that considers the family component.
Visit: kpmg.com/familybusiness
About 乐鱼（Leyu）体育官网 Private Enterprise
Passion, it鈥檚 what drives entrepreneurs, it鈥檚 also what inspires 乐鱼（Leyu）体育官网 Private Enterprise advisers to help you maximize success. You know 乐鱼（Leyu）体育官网, but you might not know 乐鱼（Leyu）体育官网 Private Enterprise. 乐鱼（Leyu）体育官网 Private Enterprise advisers in 乐鱼（Leyu）体育官网 firms around the world are dedicated to working with you and your business, no matter where you are in your growth journey 鈥� whether you鈥檙e looking to reach new heights, embrace technology, plan for an exit, or manage the transition of wealth or your business to the next generation. Working with 乐鱼（Leyu）体育官网 Private Enterprise, you鈥檒l gain access to a trusted adviser 鈥� a single point of contact who shares your entrepreneurial mindset. Access to 乐鱼（Leyu）体育官网鈥檚 global resources and alliance network can help you drive your business forward and meet your goals. Your success is 乐鱼（Leyu）体育官网 Private Enterprise鈥榮 legacy.
