Thinking about succession?

All business owners will eventually hand over the reins. For some this will be forced upon them, either by  financial difficulty, ill-health, or even death, whereas others will plan a thought-out, tax efficient and controlled  handover. Giving your business the best chance of ongoing success is rarely as easy as simply gifting shares to the  next generation – it requires a careful transition, executed at the right time, and structured to best serve the  needs of the business.

The graphic below sets out a small selection of the typical questions family owner managers should consider as  part of  building a thought-out, tax efficient and controlled handover of their business.

Succession planning graphic 1

There are several potential intermediary stages between being a full-time owner manager of a business (bottom of the staircase) and being completely extricated from a business (top of the staircase). The journey from bottom to top can either be taken all in one go or one or two stages at a time.

The graphic below sets out the different stages and what they entail, the left side relating to your managerial control of the business and the right side to your financial investment in the business. Your advisers should be able to guide you through the pros and cons of each stage, including the legal, tax and commercial consequences. Note: it is usually recommended that the left and right sides stay roughly aligned!

Succession planning graphic 2

Download the full guide here.