No doubt you have spent many years building your business; you look after your precious customers and you work hard building a good reputation in your chosen field. But what happens if you aren’t around?
There may be 2 or 3 directors in your business.
- What happens to their share of the business if they couldn’t work due to a critical illness or even died?
- Is there sufficient money in the business account to buy out their share?
Most business owners either don’t know the answers to those questions, or do know but just keep hoping the worst won’t happen.
Don’t under-estimate the impact that any directors absence would cause.
Many people insure the premises they work from, insure their workers in case of accident and the stock they carry. But many don’t bother insuring the most important assets in the business….. The Directors.
The good news is that there are things you can do to safeguard your business should the worst happen.
You may have your will sorted out, but did you know you can have a will for your business? Its called a Shareholder Agreement, which sets out in black and white what happens to shares in the business if any of the shareholders die. It also ensures that there is sufficient provision for the business and remaining directors to be able to buy those shares from the deceased directors family and therefore provide a valuable lump sum to them.
It doesn’t cost the earth and the company should receive tax relief against Corporation Tax.
Still not sure what you need?
Contact Andy here at Egan Roberts for an initial chat, he has a number of years experience in advising businesses just like yours about the best way to protect the business. He is also able to chat over other financial planning matters that you may not have given much thought to. You can contact Andy on 01254 583515 or by email firstname.lastname@example.org.