One minute with Jo Bateson, Partner at Mercer & Hole.
What’s keeping you busy at work?
The Autumn Statement is the biggest tax shake-up in my career (and I have been doing this a long time!). So, I am super busy helping clients to re-think their entire succession plans. The emphasis has moved towards helping clients completely re-think their financial affairs.
If you could make one change to tax, what would it be?
I have always thought that it was unfair that close companies do not get tax relief on funds used to pay ‘dry’ tax charges, i.e. tax charges that arise without resulting cash. A prime (and topical) example is IHT charges on private companies on a death or on a ten-year anniversary for shares held in trust. To fund the IHT liability, the cash typically comes from the business, which means that the cost of a £100 IHT liability is actually almost £170 assuming that the funds are paid to the shareholder by way of a dividend (as is usually the case). UK close companies should be able to pay a special dividend to a nominated shareholder to fund their IHT liability, which should either be tax-free in the hands of the shareholder or the income tax liability should be available as a credit against their IHT liability. I am already seeing family businesses looking at their potential IHT liabilities post-April 2026 when the Business Property Rules are due to change and considering their cash reserves. This change could help soften the impact of the BPR cap.
What do you know now that you wish you’d known at the start of your career?
The careers advice that I would give my earlier self would be to learn how to network in a way that is authentic and to get out and do it. Networking is a key skill as a private client adviser as it is a source of work, a resource to help with client issues and a way broaden your knowledge of the private client world. Early in my career, I avoided anything labelled as a networking event, but I soon learned that there were different ways to network which didn’t always involve being somewhere in the evening with a drink. Social media, such as LinkedIn, is a great way to get yourself out there, and I have really enjoyed building my network that way. Breakfasts, lunches, dinners and coffees with smaller groups of people where you have things in common are also a great way to network.
Are there any new rules that are causing a particular problem?
The Temporary Repatriation Facility (TRF) which will be introduced from 6 April 2025 to encourage non-doms to remit money to the UK is proving to be tricky from a practical perspective. Whilst an individual can designate an amount on which the TRF applies which seems fairly straightforward, how we should advise clients to segregate their funds within their bank accounts is not as obvious. I had hoped that clients would have fewer bank accounts under the new rules, but it looks like many clients will need more!
Any devil in the detail in the Budget?
The changes on moving to a residency-based test for IHT from a domicile-based one has had some interesting implications for Brits who have moved abroad. As a UK domicile, their worldwide assets are currently within the scope of UK IHT during their lifetime and on death irrespective of where they live. From 6 April 2025, Brits who have been living abroad for more than 10 years will not be subject to UK IHT on their non-UK assets. This is making me re-think how we advise Brits living abroad and whether it makes sense for them to create trusts with their non-UK assets. When the trust rules changes in 2006, I did wonder whether that was the end of trusts, but here we are almost 20 years later and trusts are even more in demand than ever.
You might not know this about me but...
I have just designed a range of Christmas decorations that are currently being manufactured and will be going on sale shortly. My husband runs a design and 3D manufacturing business and during my time off before joining Mercer & Hole, I decided to design some Christmas decorations inspired by a trip with the kids to Switzerland during half term. I am a big fan of Christmas and could never find the perfect Christmas ornament so am excited to see how they turn out!
One minute with Jo Bateson, Partner at Mercer & Hole.
What’s keeping you busy at work?
The Autumn Statement is the biggest tax shake-up in my career (and I have been doing this a long time!). So, I am super busy helping clients to re-think their entire succession plans. The emphasis has moved towards helping clients completely re-think their financial affairs.
If you could make one change to tax, what would it be?
I have always thought that it was unfair that close companies do not get tax relief on funds used to pay ‘dry’ tax charges, i.e. tax charges that arise without resulting cash. A prime (and topical) example is IHT charges on private companies on a death or on a ten-year anniversary for shares held in trust. To fund the IHT liability, the cash typically comes from the business, which means that the cost of a £100 IHT liability is actually almost £170 assuming that the funds are paid to the shareholder by way of a dividend (as is usually the case). UK close companies should be able to pay a special dividend to a nominated shareholder to fund their IHT liability, which should either be tax-free in the hands of the shareholder or the income tax liability should be available as a credit against their IHT liability. I am already seeing family businesses looking at their potential IHT liabilities post-April 2026 when the Business Property Rules are due to change and considering their cash reserves. This change could help soften the impact of the BPR cap.
What do you know now that you wish you’d known at the start of your career?
The careers advice that I would give my earlier self would be to learn how to network in a way that is authentic and to get out and do it. Networking is a key skill as a private client adviser as it is a source of work, a resource to help with client issues and a way broaden your knowledge of the private client world. Early in my career, I avoided anything labelled as a networking event, but I soon learned that there were different ways to network which didn’t always involve being somewhere in the evening with a drink. Social media, such as LinkedIn, is a great way to get yourself out there, and I have really enjoyed building my network that way. Breakfasts, lunches, dinners and coffees with smaller groups of people where you have things in common are also a great way to network.
Are there any new rules that are causing a particular problem?
The Temporary Repatriation Facility (TRF) which will be introduced from 6 April 2025 to encourage non-doms to remit money to the UK is proving to be tricky from a practical perspective. Whilst an individual can designate an amount on which the TRF applies which seems fairly straightforward, how we should advise clients to segregate their funds within their bank accounts is not as obvious. I had hoped that clients would have fewer bank accounts under the new rules, but it looks like many clients will need more!
Any devil in the detail in the Budget?
The changes on moving to a residency-based test for IHT from a domicile-based one has had some interesting implications for Brits who have moved abroad. As a UK domicile, their worldwide assets are currently within the scope of UK IHT during their lifetime and on death irrespective of where they live. From 6 April 2025, Brits who have been living abroad for more than 10 years will not be subject to UK IHT on their non-UK assets. This is making me re-think how we advise Brits living abroad and whether it makes sense for them to create trusts with their non-UK assets. When the trust rules changes in 2006, I did wonder whether that was the end of trusts, but here we are almost 20 years later and trusts are even more in demand than ever.
You might not know this about me but...
I have just designed a range of Christmas decorations that are currently being manufactured and will be going on sale shortly. My husband runs a design and 3D manufacturing business and during my time off before joining Mercer & Hole, I decided to design some Christmas decorations inspired by a trip with the kids to Switzerland during half term. I am a big fan of Christmas and could never find the perfect Christmas ornament so am excited to see how they turn out!
