If you own a business, your Will should not only deal with your personal possessions and savings. It should also fit with your plans for the business.
The right approach depends on how your business is set up. A sole trader, limited company shareholder, partnership, and LLP member can all be treated differently when they die.
Clear planning can help protect the value of the business, reduce confusion for your family, and give the people left behind a practical route forward.
Creating a Will is free with By The Willow. We believe everyone should be able to put important estate planning documents in place, with optional paid support available where extra reassurance is needed.
There is no single answer, because business ownership can work in different ways.
The first step is to understand whether you operate as a sole trader, own shares in a limited company, work through a partnership, or are a member of a limited liability partnership.
If you are a sole trader, the business is not legally separate from you in the same way as a limited company.
Business assets may form part of your estate, alongside your personal assets and liabilities. This could include tools, stock, equipment, customer records, intellectual property, a business bank account, or money owed to the business.
Your Will can say who should inherit your estate, including the value connected to the business. If you want a particular person to take over the business or receive specific business assets, it is sensible to get advice so the wording is clear and practical.
A limited company is a separate legal entity. If you own shares, those shares may form part of your estate, but what happens next may depend on the company's articles of association and any shareholder agreement.
These documents may include rules about share transfers, who can inherit shares, whether the company or other shareholders have a right to buy them, and how the shares should be valued.
If those documents say what must happen when a shareholder dies, they may affect what your executors can do, even if your Will says something different.
If you are in a business partnership, check the partnership agreement carefully.
A partnership agreement may say what happens to your share if you die, whether the remaining partners can continue trading, and how your estate should be paid for your interest.
If there is no agreement, default partnership rules may apply. In some cases, the death of a partner can cause the partnership to dissolve, which can create practical and financial problems for everyone involved.
A limited liability partnership, or LLP, should usually have an LLP agreement or members' agreement.
This agreement may explain what happens if a member dies, how their interest is valued, whether the LLP can continue, and what rights the deceased member's estate has.
Before making or updating your Will, it is worth reviewing the LLP agreement so your estate plan and business documents work together.
In some situations, you may be able to leave a business interest or business assets to a particular person.
This may be appropriate if you have a clear succession plan and want the business to continue after your death.
However, business gifts need careful wording. The Will should be clear about what is being left, whether debts or liabilities are included, and whether any business agreements restrict the transfer.
If the business is valuable, complex, regulated, jointly owned, or linked to property, it is sensible to take legal and tax advice before relying on a simple gift clause.
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Your executors may need to understand what the business is, where key information is held, who to contact, and what immediate steps may be needed.
Useful information may include:
◆ Company number, trading names, and registered office details
◆ Accountant, solicitor, bookkeeper, insurer, and key adviser details
◆ Business bank accounts, payment platforms, and merchant accounts
◆ Websites, domain names, email accounts, cloud storage, and software subscriptions
◆ Key contracts, leases, licences, debts, and insurance policies
◆ Emergency instructions for staff, customers, or business partners
Executor Vault, available for £10 per year, can help you record digital assets and upload important files so your executors know what exists and where to find guidance.
Some business assets may qualify for Business Relief for Inheritance Tax, but the rules are detailed and depend on the type of business, the asset, and how long it has been owned.
Business Relief can reduce the value of qualifying business property when calculating Inheritance Tax. However, not every business or asset qualifies, and the rules can change.
If your estate may pay Inheritance Tax, or if business assets are a major part of your estate, you should take tax advice before finalising your Will.
Business owners should consider legal advice where:
◆ You need help understanding business agreements
◆ You want to leave your business or shares as a specific gift
◆ You need provisions that work alongside a shareholder, partnership, or LLP agreement
◆ Your estate may be affected by Inheritance Tax or Business Relief
◆ You own a farming business, property-heavy business, or regulated business
◆ You have business partners, investors, employees, or family members involved in the business
For added reassurance, By The Willow offers an optional Professional Review for a one-time payment of £30.
A specialist can review completed documents such as your Will or Advance Decision and provide notes before signing.
This can help identify common mistakes, check clarity and consistency, and highlight wording that may not reflect your intentions clearly.
For complex business succession, specialist legal or tax advice may still be needed, but a review can be a useful extra check for many people.
Business circumstances can change quickly. You may bring in a new partner, sell shares, buy property, take on debt, change trading structure, or step back from day-to-day work.
Your Will should be reviewed whenever the business changes in a way that affects ownership, control, value, or succession.
By The Willow offers unlimited Will updates for £10 per year, helping clients keep their Will current as their circumstances change.
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By The Willow™, a trading name of LCR Group Holdings, provides access to self-service legal forms and information. By The Willow™ is not a law firm and does not provide legal advice. It is not a substitute for a qualified attorney’s advice.
