Wills and Succession Planning

For clients who have spent much time, energy and finances in setting up and running a successful business, it is extremely important to plan for when they wish to retire from the business.

Unfortunately, with the time and energy taken in running the actual business, what happens on their death, or loss of mental faculties, is often overlooked.  This can lead to serious issues and complications if steps have not been taken to plan for these.

I work closely with clients and their other professional advisors (especially accountants), financial advisors and commercial lawyers, in reviewing succession planning and implementing plans to assist with this.

My interest is in advising on the steps that can be taken to ensure that the business owner`s wishes regarding what would happen to their interest in the business on their death, or loss of faculties, can be carried out.  This includes preparing detailed Wills.

To be able to advise business clients on how they can leave their business assets and interests in their Wills, it is necessary to consider several factors.  These can include:

  • Finding out what the business client wants to happen to their business interests – eg pass to their family
  • Reviewing what would need to happen to their business interest upon death – eg
    • What do the Articles of Association specify?
    • Is there a Partnership Agreement? If not, I can introduce the client to the necessary advisors to deal with this
    • Review whether cross option agreements and / or keyman insurance are in place and introduce to the relevant advisors if required;
  • Review the Inheritance Tax position to take account of relevant reliefs, such as Business Property Relief and Agricultural Property Relief
  • Review if they need to appoint executors in their Wills with the relevant business experience

I also advise business clients on Commercial Lasting Powers of Attorney.

Commercial Lasting Powers of Attorney

We all take out car, house and contents insurance, but how many people take steps to provide security for themselves and their family if they were to lose mental faculties?

Many people believe that losing mental faculties is only something that happens with age, however this is not always the case.  People can unfortunately lose the ability to look after their own affairs for several reasons, such as an accident or illness, which can strike at any age.

This is a concern for business owners and co-owners.  If they were to lose mental faculties, especially with no, or little, warning it could have a significant impact on the continued running of the business.

As with someone`s personal affairs, if they were no longer able to look after their own financial (including business) affairs, then no-one is authorised to do so on their  behalf without having been appointed as an attorney by them in a Lasting Power of Attorney (LPA).

Even in long term business relationships, business colleagues will often not be able to deal with a colleague`s business interests, or carry out their normal activities in running, or working in, the business, without an LPA.

If the person who loses faculties had prepared a Property and Financial Affairs LPA, but had not placed any restrictions on what their attorneys could do (such as stating that they were not authorised to deal with their business interest), there is a risk that their attorneys ( who may well not have had any previous involvement in the business) would be authorised to do so.

If no steps are taken to protect against this, it could result in issues and complications in the running of the business at what is already a stressful time.

You can protect against this by preparing Commercial LPAs.

In a Commercial LPA, you can appoint people who would be best suited to look after your business interests as your attorneys.  You should also prepare separate Property and Financial Affairs LPAs to deal with your personal property and financial affairs.

In order to ensure that both your personal and business interests are dealt with separately by the relevant attorneys, your Commercial LPA should include the restriction that the commercial attorneys are only authorised to deal with your business interests.

Likewise, your personal Property and Financial Affairs LPA should include the restriction that the personal affairs attorneys are not authorised to deal with the business interests.

As with a Property and Financial Affairs LPA, a Commercial LPA could be used once it has been registered with the Office of Public Guardian and not only if you had lost or were losing mental faculties.  This therefore offers flexibility where for example, you may be overseas and unable to sign business forms, your attorneys could do so in your absence.

Therefore, by preparing Commercial LPAs, you can ensure that your business need not be affected directly in the hopefully unlikely scenario of your losing your mental faculties.  It also offers you, and your colleagues, flexibility, security and peace of mind.

Succession Planning for Business Owners & Business Consulting

Many business owners are too busy developing their business to find time to consider succession planning.

Succession Planning for Business Owners

This includes:

  • What happens to the business when the owner wants to retire?
  • What steps the owner needs to take to plan their retirement from the business, including tax implications
  • Ensuring their wishes can be carried out in their Wills and then carrying out and implementing their wishes in detailed and professionally prepared Wills
  • Preparing Commercial Lasting Powers of Attorney to plan for any possible issues and complications in the running of the business if the owner, or co-owner was to lose mental faculties
  • (Please see Business Wills and Succession Planning for more details.)

I work closely with other professionals (mainly accountants, financial advisors and commercial lawyers) to offer advice on the steps that can and need to be taken and help implement the business owner`s succession and exit strategy planning.

I also give talks and seminars (again with other professionals) on succession planning for business owners.

Business consulting

Having worked in several professional sectors (the military, business and law) I have gained a wide level of experience in different management styles and approaches.

I have managed, developed and led teams and departments, in a wide variety of different and challenging scenarios and have spent much of my time in “firefighting” roles.

Although I do not believe in “change for change sake” I like to think “outside the box” and try out and implement alternative ways of achieving outcomes.

I am passionate that a good manager needs to be a leader who knows, understands, and genuinely cares for their staff.  In my view, a leader leads by example and from the front, as well as being able to step back and manage from above.

If I can assist you in any management or leadership matter, please do not hesitate to contact me.