Ian Bond, Head of the Wills & Estates team at Thursfields, specialising in wealth succession and estate planning offers a brief guide on succession planning for business owners.
Here at Thursfields, we understand how successful business owners have often devoted years of hard work to building their thriving and profitable enterprises.
These are often family affairs, with generations of the same family working together. However, planning for the succession of that business through the generations is something that is often delayed or overlooked, without an overall cohesive strategy in place.
For business owners, their company is likely to be the most valuable asset in their estate, and probably the most complex to manage. But lack of time – and, too often, a failure to fully appreciate the issues that can arise – frequently means they are slow to take appropriate advice for their own personal position and that of their family.
Too many businesses are ruined by the failure of owners to contemplate what should happen to their concern in the event of their untimely death. This not only potentially misses valuable tax reliefs but can also potentially cause dispute and disharmony in the family.
At Thursfields, we help business owners to understand why it is worth the time and effort now to develop and implement a succession plan before life circumstances take these decisions out of their hands.
Executing a business succession plan is hard work. But we are experts in business succession planning from both the company and individuals’ perspectives. We know that it is not just about getting the legal position correct (that’s a given) but also proactively helping business owning clients to navigate multiple decisions and strategic considerations.
Doing this correctly can result in maximising the chances of a successful transition as well as enjoying the greatest possible tax benefits. The business owner can then enjoy a long and happy retirement by taking out value from the business as a reward for their hard work, but still leaving it financially secure for the next generation.
Thursfields follows two simple guiding principles when working with business owners and their families when it comes to succession planning for a family enterprise:
1.Family harmony: putting the family first is key to the survival of a business. Decisions that keep the family together should be given priority over future profits. Dynasties crumble due to family feuds and individual egos overpowering the natural affection and mutual respect that comes with families.
2.Communication: there needs to be clarity amongst all the family members, especially the next generation about their future roles. Business owners must have open and honest discussions with relatives, both about their exit and the owners who follow them. The next generation needs to be onboard with future decisions so that a succession plan is tailored in line with mutual needs.
We understand that it can often be difficult to find the time to deal with personal matters, and so we have built our reputation by providing timely and practical advice to our clients.
Thursfields has an excellent team of specialist personal, family and corporate solicitors to look after you, your family and your business.
We will tailor our approach to suit the client and can take instructions by phone, video conference or in person at our Birmingham, Solihull, Worcester, Kidderminster or Halesowen offices.
Any business owner who would like more information can contact us on 0345 20 73 72 8 or email email@example.com
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Thursfields Legal have office across Worcestershire and the West Midlands: Worcester | Kidderminster | Dudley | Halesowen | Solihull | Birmingham