Exit strategies vary by business type and size, as well as by the circumstances and objectives of the business owner (or owners), but strong plans recognize the true value of a business and are aligned with the business owner’s long-term wealth goals.

For many business owners, whose focus right now is building up value in their company, exit planning is seen as something that can be put off until some undecided future date. However, putting an exit plan in place earlier, rather than later, can bring clarity and enhanced focus in order to maximise the value that can be crystalised by the business owner, or passed efficiently to family members or other stakeholders. Pushing this out can lead to reduced options at the time of exit, paying more taxes and missed opportunities in the meantime to maximise wealth creation opportunities tax efficiently from profitable years in business.

For many business owners, exiting their business may also mean retiring from working life completely. For others, it can mean continuing to work with reduced responsibility, or on a part-time basis with a better work-life balance. Either way, we find securing and maintaining financial independence to be a common goal, regardless of the definition of retirement.

Putting a retirement and investment plan in place early, that aligns with your business exit plan, can ensure that the proceeds from the sale of your company, together with your personal and pension assets accumulated over time, can position you well to achieving your financial goals.

When putting an investment plan in place, it is important to understand the role of each of your assets in building your wealth over time and tax-efficiently. When your business is your primary source of wealth creation, your plan is likely to be centred on the strategy to maximise the value of this asset.

Realising value in your company

You may be able to gain relief on disposal of your company by claiming Retirement Relief or reduce your 33% liability down to 10% by claiming Entrepreneur Relief. By planning well in advance, with your accountant or tax advisor, you could reduce or eliminate CGT. Including pension planning in your strategy provides another means of extracting value in a tax-efficient manner. Pension funding can ensure that you are extracting profits out of the business into your name while ensuring you are keeping the overall value of the business within the scope for retirement relief or entrepreneurial relief.

Retirement Relief

If an individual is between 55 and 66 at the date of disposal, then relief on proceeds of up to €750,000 is available on the disposal. So, if the proceeds received are €750,000 the CGT that would normally be payable is reduced to zero and no tax needs to be paid. For individuals older than 66 at the date of disposal, the limit for the relief available is reduced to €500,000.

Entrepreneurial Relief

The relief provides that a 10% rate of CGT applies in respect of chargeable gains on disposals of a business, up to a lifetime limit of €1 million. The maximum tax saving is therefore €230,000 per individual. You must have owned the business for a continuous period of three years in the five years immediately prior to the sale and must own not less than 5% of the shares in the company.

Pensions – Extracting Wealth with a PRSA

Recent changes to Personal Retirement Savings Accounts (PRSAs) in the recent Finance Act 2022, which came into law on 25th December 2022, have made these pension structures an important wealth management tool for business owners. These changes make reaching the maximum tax-efficient pension (Standard Fund Threshold) of €2m achievable for all business owners regardless of their salary and service with the company. Read our blog here for more information about this valuable opportunity.

Managing the Investment of Proceeds from a company sale

Following the sale of your company, the proceeds should be invested in line with your investment plan and financial goals. Your investment plan will outline how these cash proceeds should be invested within your portfolio. One of the fears of investing a large cash lump sum is that in volatile market conditions, markets could fall immediately after you invest, causing the loss of some of your hard-earned, but newly realised, wealth. Instead, averaging your money into the market by spreading out the investment of your cash periodically, buying into the market at regular intervals and in roughly equal amounts can mitigate this risk. When executed in a structured and disciplined way, this approach can have significant benefits for your investment portfolio as you are buying at various price points and so smoothing out your entry price into the markets. Many of our clients also have strategies in place that allow them to invest higher amounts after markets have experienced big falls, which can feel uncomfortable in the moment, but can add significant value over the long term.

Investing a large lump sum requires patience and planning with an investment professional. A poor investment strategy or bad timing with your investment can have significant consequences for your portfolio and its delivery of your objectives post-exit.


When putting your business exit plan in place with your accountant and tax advisor, the value of pensions and investment advice should not be overlooked. Planning ahead can ensure that, not only do you exit your company tax-efficiently, but also, that your wealth is managed in line with your long-term goals and objectives.