How to Structure Your Business for Working with Family Members (2026)

Including family members in a business structure can create significant tax savings — especially dividends to a spouse or adult children at their own (lower) tax rates. HMRC's settlement rules prevent purely artificial income-splitting. The Arctic Systems case established the "spouse exemption" for properly structured family companies. This article covers: legitimate family income-splitting, share class structures, remuneration for family members, and the HMRC tests.