Like most accountancy firms we have a lot of sole traders, companies. partnerships and individuals we prepare tax returns for:
Over the years you get to see a lot of things happen to these businesses. one area that can often remain forgotten is what would happen to the business if one of the key people passed away.
If you are in a partnership or shareholder in a company, you should ask:
- what happens to the share in your business if you pass away?
- does your spouse continue as a shareholder in the business?
- is there a buy/sell agreement in place that protects your estate and does the company have the funds to purchase your shares without placing it in financial stress?
- if you are no longer generating the income for the business, are your shares cancelled on your death – as the business cannot afford to pay your estate
There are numerous scenarios, many of them ugly and too many for us to contemplate in this blog.
If you would like to discuss partner or business protection issues, we can assist.
our advice could include the establishment of a buy/sell agreement, insurance, share buy backs, succession planning or something that is unique to your business or partnership.