Case study – WDX

Wealth Dynamix (WDX) is the UK’s leading provider of client relationship management technology for the wealth management industry. It is a privately held company, created in 2012, by a group of experienced technology and financial industry experts who recognised the need for a vertically-focused CRM solution.

The issue

WDX’s directors approached the team at Hartsfield Financial Services initially for advice on corporation tax planning.

We conducted a full review and identified that there was also a need for the company to acquire capital to purchase shares from an existing shareholder.


The solution

We used a well-respected, long-established and highly effective tool to release capital for the share purchase.

By transferring the directors’ pensions, we set up an SSAS – a Small Self-Administered Scheme – which is an avenue available to directors and owners of limited companies.

Like a traditional pension, an SSAS will pay out a lump sum and an income. However, it can also be used to provide capital for investment purposes – in this case, capital to buy the director’s shares.

The pensions of three directors were transferred into an SSAS, which then provided a loan to buy the shares.

The loan is payable back over five years at a commercial rate of interest (in this case 7 per cent) which goes directly into growing the SSAS pension pot. Had the capital been raised by, for example, a bank loan, the interest would have gone to a third party.

The loan was secured using the intellectual property of the business, plus general debenture over the company.

An initial sponsoring employer contribution to the SSAS, by WDX, also had the effect of saving £12,000 in corporation tax.

The three directors continue to make annual contributions which save a further £13,500 in corporation tax per annum. The annual tax saving has been between £24,000 and £30,000 per year since the SSAS was set up.

Surplus money in the SSAS is invested in a portfolio of funds and is also available to WDX for further loans as long as the maximum was taken out does not exceed the 50 per cent limit.


The outcome

From an initial desire to reduce corporation tax liability, the team at Hartsfield were able to create a financial vehicle, in the form of an SSAS, which had the benefit of:

  • Cutting corporation tax
  • Providing capital for a loan, in this case for purchasing shares
  • Ensuring loan repayments would grow the pension fund, rather than go to a third party
  • Creating a pension pot to invest in a diverse portfolio as well as for future WDX purposes

Brent Randall, COO of WDX, said: “The Hartsfield team are clearly experts in this field and have delivered an effective solution for our requirements.  The Hartsfield advisers made this process extremely efficient and minimised the effort we had to put into the scheme set up and ongoing reviews, while keeping us informed and compliant with our obligations as company directors and taxpayers.  Hartsfield is a trusted adviser to WDX.”