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Inheritance tax: why scaffolding business owners must plan now
You spend decades building a successful scaffolding business. Steady contracts, loyal clients, a reputation earned through years of hard work. Then, unexpectedly, your life is cut short.
Your family assumes the business will provide financial security. On paper it looks that way; the company is valuable, with equipment, contracts and a long trading history. But within months an inheritance tax bill arrives. The business is asset-rich but cash-poor. There is no cash set aside to meet the liability and no plan in place. What follows is a pattern that banking firm Arbuthnot Latham says they see far too often. Contracts slip, equipment is sold at a discount, pressure builds and the business that took a lifetime to build starts to unravel.
It is a sobering picture. But it is also an entirely avoidable one.
Inheritance tax planning has a habit of slipping down the priority list for business owners. There is always something more pressing; a project to price, a team to manage, cash flow to watch. Planning for something that feels far off is easy to put off. But as Arbuthnot Latham's Paul Reidy, Director of Construction Services, points out, the tax landscape has shifted significantly in recent years and more scaffolding business owners are exposed than they realise.
Since April 2026, Business Relief has become more tightly applied. Up to £2.5 million per individual may be eligible for 100% relief, but amounts above that typically receive only 50% relief depending on structure and eligibility. Inheritance tax thresholds have remained frozen as asset values have risen, quietly pulling more estates into scope. And from April 2027, pensions are also set to form part of the taxable estate.
Scaffolding businesses face particular risks. Much of the value is illiquid; contracts, plant, vehicles and goodwill cannot quickly be converted into cash without damaging the business. Wealth is often intertwined, with personal guarantees, property held personally but used by the business, or profits reinvested rather than extracted. Succession planning is frequently delayed because the business always comes first.
The good news is that with the right planning, the picture can look very different. Managed in good time, inheritance tax planning can reduce the overall liability, create clarity for families and successors and ensure that wealth passes on your terms rather than HMRC's. Small decisions made years in advance often have outsized effects later on.
It is worth asking yourself a few honest questions. Do you know what your estate looks like today? Do you know how much could go to inheritance tax? If something happened tomorrow, who would really benefit most; your family or HMRC?
For scaffolding business owners who want to explore their options, Paul Reidy and the team at Arbuthnot Latham can be contacted on 020 7012 2041 or at [email protected]