No entrepreneur wants to think about their own mortality, especially in connection with their business, but the fact is that not everyone is lucky enough to retire before they need to start thinking about writing their will. There are numerous statutes in law that are there to deal with your business in the event that you pass away before handing over control, but they may not all fit with what you want to happen.
Partner Businesses
One of the major things to think about is what will happen if you’re in a partnership. Before the business is started, you’ll have usually signed a partnership agreement that deals with a lot of the details in the event that one partner leaves. You’ll need to review this before making a will, and it may be wise to discuss your end-of-life plans with your business partner.
Choosing Will Inherit Your Business Assets
As a general rule, you’ll have complete control over what happens to the business assets you own when you die, and you can specify that anyone takes control of them, whether that’s a family member who inherits them, or a trusted employee that will be responsible for the running of the business. Certain things may simply pass to a surviving co-signer; if for example you’ve signed a joint tenancy agreement, then the other person will become liable for the rent.
It is very important that you specify where you want all of your business assets to go, or you risk them being split amongst parties that you may not approve of. Disputes after your death are never easy; you can find out more on the Willclaim Solicitors blog.
Make Preparations
In the UK, inheritance tax is one of the main concerns for those wishing to leave assets in their will. Fortunately, it’s not in the best interests of a business to incur large taxes when an owner dies. For this reason, business relief, a type of tax reduction, is available on numerous business assets. With a properly made will, you may be able to negate almost all of the tax that would normally be due on inheritance.
Preparation then, is the key here. As you prepare to make sure that the business is in a position to continue without you, you also need to prepare to give your assets away to those you really want to have them.