How can I preserve my Business Assets for my Family?


Without the appropriate business succession strategies:

  • Your spouse/partner and children may not inherit your share of a business.
  • Business partners may not be able to buy out the Deceased’s share.
  • The surviving spouse or children may be obliged to take over the running of the business.
  • The value of the business could depreciate owing to the inexperience of any Beneficiary.
  • The business may have to be sold and the proceeds become liable to Inheritance Tax.

Protecting the family business

Hard work and dedication has meant that you have built up a sound business to benefit you and your family, and naturally you would want to ensure that your loved ones are provided for in the event of your death. So what if the worst should happen and either you, or a business partner were to die?

Who would actually be entitled to this share of the business?

Without a valid Will the Deceased’s share would be subject to the Laws of Intestacy and the person who inherits may not be the person you intended.

Would you or your business partner be content to run your business with their surviving spouse or their Beneficiaries?

This could have a major impact on the running of the business, or the value of the business may now go down following the death of such a key person.

Would they even want to be involved with the running of the business?

Many spouses would probably not want to be burdened with the running of a business they may know very little about.

For instance, if there are young children to care and provide for then the surviving spouse might prefer to be bought out.

Would you have sufficient funds to purchase the Deceased Director’s share from his family? Or would the business have to be sold?

If the business is sold by the Deceased’s Beneficiaries, how would this impact on their estate as their assets increase? How would it also affect the surviving business partner’s assets as these too increase? Both parties’ estates could be impacted by Inheritance Tax in the future, having now lost any Business Relief previously available whilst the company was still trading. With the sale of the business you risk losing 40% of the cash proceeds to the Tax man.

Perhaps you have made some provision for this eventuality

You may feel that you have prepared for the worst and taken out sufficient Life Cover to protect all parties’ shares of the business. You may even have had the presence of mind to set up a Company Will and a Cross Option Agreement.

This would ensure that the surviving business partner/s has the right to buy out the Deceased’s share of the business. The proceeds of the Family Life Assurance Policy could be paid to the surviving spouse or Beneficiaries, in exchange for their inherited share of the business. Equally, the surviving spouse or Beneficiaries would be able to exercise their right to sell this share of the business to the remaining business partner/s in exchange for either the market value or an agreed amount covered by a Family Life Assurance Policy.

But what about the impact that a standard Cross Option Agreement has on someone’s estate?

If you or a business partner dies their share will pass to their spouse or Beneficiaries through their Will. This is now deemed to be part of their estate. Whilst this share is held and the business continues trading then the assets could be exempt from Inheritance Tax if they qualify for Business Relief (BR). Once the Cross Option has been effected then BR id no longer available on the proceeds i.e. from any Life Assurance. The spouse’s assets assessable for Inheritance Tax (IHT) have now increased by the funds received from the Life Assurance Policy risking 40% of the proceeds to IHT. Depending on the size of the business this could be a significant loss.

These assets are also now at risk from attack from any future Remarriage Claims, Creditors or Bankruptcy and Long Term Care Costs.

What about the consequences a standard Cross Option Agreement has for the surviving business partner?

With a standard Cross Option Agreement the surviving partner now owns 100% of the company. This is fine whilst the business is still trading and whilst BR is still applicable

However, what would happen when they decide to sell the business?

Now their personal estate will be increased to include the proceeds from the sale. This leaves the spouse wide open to attack from Inheritance Tax, Creditors/Bankruptcy, Divorce Settlements and Long Term Care Costs.

So how do our Wills and Cross Option Agreements differ?

We offer Business Estate Planning tailor made to suit you and your business. It takes the Standard Planning options available on the High Street a significant step further.

Our planning provides significant protection to the business and reduces the possible impact of Inheritance Tax dramatically. Furthermore the business and proceeds from a future sale of the business are protected for the Bloodline from IHT, Remarriage, Creditor Claims and Nursing Care Fees.

Our Planning leaves each partner or director’s share of their business to individual Family Trusts through appropriate clauses written into their Wills.

Furthermore the appropriate Life Cover will also be assigned to ‘Shareholder Trusts’ so that these proceeds do not impact on the surviving individual estates.

So how does this benefit the remaining business partner?

The surviving business partner still retains their original share of the business but the Deceased’s partner’s share is passed directly into a Shareholder Trust(s) from where the Life Assurance proceeds were originally paid. The surviving Director still has the fullest of control on the business as he is a Trustee of the Shareholder Trust(s).

The Shareholder Trust(s) can also be utilised as a further efficient Income Tax planning tool. Now that a proportion of the business is in the Shareholder Trust(s) any dividends paid into the Trust(s) could be distributed to Beneficiaries of the Trusts who may well have nil or low rate Income Tax.

Should the surviving Director(s) decide to sell the business, only their original share of the business will enter their estate. The remaining share will belong to the Shareholder Trust(s) for which he and his family are Beneficiaries. This share is also protected and cannot be assessed for IHT purposes or be at risk from attack by Long Term Care Costs, Divorce and Creditors/Bankruptcy.

To sign up for a FREE meeting with one of our advisers, click ‘Apply Today’

Apply Today

“It’s never too early- but it’s often too late!!!”



17 thoughts on “How can I preserve my Business Assets for my Family?”

  1. I have been browsing online more than 4 hours today, yet I never
    found any interesting article like yours. It’s pretty worth enough for me.
    In my view, if all webmasters and bloggers made good content as you did, the
    internet will be a lot more useful than ever before.
    0mniartist asmr

  2. Hey would you mind letting me know which hosting company you’re working with?
    I’ve loaded your blog in 3 different web browsers and I must say this blog loads a lot faster then most.
    Can you recommend a good hosting provider at a fair price?
    Many thanks, I appreciate it! 0mniartist asmr

  3. Hello! I could have sworn I’ve been to this web site before but after looking at many of the posts I
    realized it’s new to me. Regardless, I’m definitely pleased
    I discovered it and I’ll be book-marking it and checking back frequently!
    0mniartist asmr

  4. I was very happy to uncover this web site. I wanted to
    thank you for your time due to this fantastic read!!

    I definitely loved every bit of it and i also have you saved to fav to check out new stuff on your blog.
    0mniartist asmr

  5. Wonderful blog! I found it while surfing around on Yahoo News.

    Do you have any suggestions on how to get listed
    in Yahoo News? I’ve been trying for a while but I never seem to
    get there! Appreciate it

  6. Right now it sounds like BlogEngine is the best blogging platform available right now.
    (from what I’ve read) Is that what you are
    using on your blog?

  7. Hello my loved one! I wish to say that this article is amazing, nice written and include approximately all significant
    infos. I’d like to see more posts like this .

  8. I do not know if it’s just me or if perhaps everyone else encountering problems with your site.
    It appears as if some of the text in your content are running off the screen. Can someone else
    please provide feedback and let me know if this is happening
    to them as well? This might be a problem with my browser because I’ve had this happen previously.
    Many thanks

  9. Hello There. I discovered your blog the use of msn. This is a very smartly written article.
    I will make sure to bookmark it and come back to learn more of
    your useful info. Thank you for the post.

    I’ll definitely return.

  10. If you want to increase your familiarity only
    keep visiting this web site and be updated with the most up-to-date information posted here.

  11. For most up-to-date news you have to go to see
    world-wide-web and on the web I found this site as a most excellent
    web page for most up-to-date updates.

  12. scoliosis
    Good day! I know this is kinda off topic however , I’d figured I’d ask.
    Would you be interested in trading links or maybe guest authoring a blog article or
    vice-versa? My site goes over a lot of the same subjects as yours
    and I believe we could greatly benefit from each other.
    If you are interested feel free to send me an e-mail.

    I look forward to hearing from you! Wonderful blog by the way!

  13. scoliosis
    Fantastic site you have here but I was wanting to know if you
    knew of any forums that cover the same topics talked about in this
    article? I’d really love to be a part of community where
    I can get opinions from other experienced individuals that
    share the same interest. If you have any suggestions, please
    let me know. Cheers! scoliosis

  14. scoliosis
    I am sure this post has touched all the internet visitors,
    its really really nice post on building up new
    weblog. scoliosis

  15. free dating sites
    Excellent goods from you, man. I have take into accout your
    stuff prior to and you’re just too wonderful. I actually
    like what you have bought right here, certainly like what you are saying and the
    way in which in which you are saying it. You make it entertaining and you still take care of to keep it wise.
    I can’t wait to read far more from you. That is really a wonderful website. dating sites

  16. What i don’t realize is in fact how you’re now not actually much more neatly-liked than you might be right now.
    You are very intelligent. You understand thus significantly in relation to this
    matter, made me in my opinion imagine it from a lot of numerous
    angles. Its like women and men don’t seem to be interested unless it is something to do with Woman gaga!
    Your personal stuffs excellent. All the time deal with it up!

  17. I’m really inspired with your writing talents as well as with the layout to your weblog.
    Is that this a paid theme or did you customize it your self?
    Anyway keep up the excellent quality writing,
    it’s uncommon to look a nice weblog like this one these days..

  18. Thanks a bunch for sharing this with all folks you actually recognize what you
    are talking about! Bookmarked. Please also seek advice from my web
    site =). We can have a hyperlink exchange arrangement between us

  19. Does your website have a contact page? I’m having a tough time locating
    it but, I’d like to shoot you an email. I’ve
    got some creative ideas for your blog you might be interested in hearing.

    Either way, great site and I look forward to seeing it
    expand over time.

  20. What’s up colleagues, how is everything, and what you would like to
    say about this paragraph, in my view its genuinely remarkable in support of me.

  21. Neat blog! Is your theme custom made or did you download it from somewhere?
    A theme like yours with a few simple adjustements
    would really make my blog jump out. Please let me know where
    you got your theme. Many thanks

  22. With havin so much content and articles do you ever run into any issues
    of plagorism or copyright infringement? My website has a lot of completely unique content I’ve either
    created myself or outsourced but it appears a lot of it is popping
    it up all over the internet without my authorization. Do you know any techniques to help protect against content from being stolen? I’d really appreciate

  23. Write more, thats all I have to say. Literally, it seems as though you relied on the
    video to make your point. You definitely know what
    youre talking about, why throw away your intelligence on just posting videos to your site when you could be giving us something
    informative to read?