Whether you are a Sole Proprietor, in Partnership or a Shareholding Director of a Limited Company, dying without a Will can have a devastating effect on the future success of a business resulting in substantial problems not only for the members of the business but also their families.
A Will is an essential requirement for business owners
For instance, think about what would happen in these circumstances:- Upon the death of a company shareholder, their shares in the Company may pass into their estate. The deceased’s family may have no real interest in the business or no experience in running the business. The deceased member’s family may need (or prefer) to have money rather than shares and they may therefore wish to sell the shares quickly. The remaining shareholders may have no control over who these shares are sold to. They may not have sufficient funds to acquire the shares of the deceased member which could lead to a forced sale, takeover or winding up of the business. The Company’s bankers and investors could lose confidence in the company. If the beneficiaries of the estate sell the shares in the business the proceeds that they receive will then form part of their own estates and could potentially be subject to risks such as inheritance tax on their death, creditors, divorce settlements and paying for the cost of long term care.
All of these eventualities can be avoided through careful planning and putting in place Wills for you and your business. If you have a family owned business where it is intended that other family members will take over the running of the business then it is essential that you have a Will in place specifying to whom the shares/business assets are to be transferred ensuring that business property relief is maximised. On the other hand if you are a partner or shareholder in a company with other partners and shareholders (non-family members) then additional arrangements will be required. Advance planning will ensure that your business can continue. It will also ensure that significant savings can be achieved and that a distressing time is not made worse by being unprepared for the financial, taxation and general business consequences of death.
If you are interested in finding out more about Wills for business owners then call 01772 722373 or contact Ellen Fay Solicitors via the website at Solicitors in Preston.
To learn more about our Wills services visit Making A Will.