Retained Profit Investment Strategy
At Holland Asset Management, we help business owners turn idle capital into a powerful investment engine. We begin with a detailed consultation to understand your financial position and business structure. Based on this, we propose a bespoke investment portfolio tailored to your needs and risk appetite.
You’re in control throughout the process, with full visibility of how your funds are allocated. We use real-time forecasting tools and hold quarterly review meetings to keep your strategy aligned with your goals.
The Business Challenge
Many successful businesses find themselves with surplus retained profits—funds that exceed operational requirements and sit in reserve accounts earning minimal interest. These reserves, while a sign of healthy profits, often lose value in real terms due to inflation.
Directors are typically restricted in how much they can extract from the business via salary and dividends. Most take a salary of around £12,750 to match their personal allowance, and top this up with dividends up to a gross income of £50,270. Beyond this threshold, dividends are taxed at 33.75%, and any amount over £125,140 is taxed at 39.35%. This is in addition to corporation tax of 19% to 25% on company profits.
The result? Substantial retained profits that aren’t working to their full potential. So, how can you deploy this capital more effectively?
- Pension Contributions
Business owners can contribute up to £60,000 per year into a pension from company profits. While the contribution isn’t eligible for personal tax relief, it is a tax-deductible expense, reducing your corporation tax bill.
This is a powerful way to extract value from your business while planning for your long-term financial future. Our FCA-regulated IFA partners are available to support you every step of the way.
- Loan Notes
Loan notes offer a flexible and attractive route for investing retained profits. We work with leading UK asset managers who use investor capital to acquire distressed residential and commercial properties below market value, delivering strong, consistent returns.
At the end of the term, investors can withdraw their capital or roll it into a new loan note. Property investors can also allocate surplus rental income (starting from £10,000) into loan notes, allowing their portfolios to grow more efficiently.
- Direct Property Investment
Property remains one of the most resilient and rewarding long-term investments. With over 30 years of market expertise, we identify high-growth UK regions offering excellent rental yields and capital appreciation potential.
We offer a full-service approach, connecting you with trusted professionals including estate agents, tax experts, mortgage brokers, and legal advisers to ensure a smooth investment journey from start to finish.
Investment opportunities include:
- Single Let Buy-to-Let
- Refurbishment Projects
- Holiday Lets
- Commercial Property
- Serviced Accommodation
We’re currently securing properties offering gross rental yields of 8% to 15%, with projected capital growth of up to 28.2% over the next four years. We recommend starting with cash investments and using mortgage finance strategically as your portfolio grows.
Call Us
Call us or drop us an email to find out how our team can support your growing property portfolio
Exit Strategy
Eventually, every business owner plans their exit. By investing retained profits now, you can build a standalone portfolio that remains under your control even if you sell your core business.
This strategy can enhance your long-term financial security and give you greater flexibility at the point of exit. We work with expert tax advisers and business coaches to help you plan your future and can connect you with trusted partners as needed.
