Introducing Family Limited Partnerships (Video)

Transcript

Rob

So you may hear advisors refer to entities as a FLP - a family limited partnership or an FLP. And these structures, although they sound different, are one of the same entity. What they are is a limited partnership, and the word ‘family’ being popped at the front doesn't actually have any technical meaning.

So, for clients who are familiar with limited partnership structures, particularly those from the private equity industry, they're quite simple structures to understand. A family limited partnership is a means of collectively holding family assets, and it's an effective way of dividing the economics from the control. So what that means is where an individual wants to give away assets to get the value out of their estate for inheritance tax purposes, it allows them to still retain a degree of control over how those assets are invested or distributed.