Wealth Advisory

Business & Farm Succession Planning

A Business Succession Plan is the process of arranging your business affairs now to ensure there is no unnecessary deterioration or loss of continuity in your business should you or one of the other stakeholders/owners or other key people leave through illness, accident or death and funds are made available for a potential buy/sell of a partner. It should also ensure that a departing owner or their estate will be fairly compensated for giving up their rights to the business.

A business succession plan should consider:

  • Each owner (and their spouse) know in advance how the business will be valued – and what their share will be. So there should be less risk of a former owner, or their spouse or estate, taking legal action over a valuation or pay-out figure.
  • It should avoid the possibility of a deceased owner’s spouse or child deciding – against the wishes of the continuing owners – to become an active hands-on partner of the business (rather than taking the pay-out).
  • It should ensure that the deceased owner’s spouse or family does not take their legal right to claim a share of the business profits without having to work in the business.
  • It should prevent a deceased owner’s spouse or estate from selling their share of the business to a third party that may be unsatisfactory or unknown to the continuing owners.
  • It should ensure the control of the business or its assets are not frozen due to legal difficulties created by the former owner, or their spouse or estate.
  • If you or one of the other owners were to die, any loans or leases your business has may be immediately callable by the lender. A business estate plan can ensure that debt can be retired by the continuing owners.
  • It should help the continuing owners to afford to keep running the business, find a replacement for the departing owner, and cover loss of profitability and business momentum due to the loss of the owner.
  • It should provide security for staff and creditors.

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Red Lion Wealth Advisory

Accounting : 47 High Street, Bendigo VIC - Wealth Advisory: 147 Queen Street Bendigo
Accounting : PO Box 564 Bendigo Vic 3552 - Wealth: PO Box 401, Bendigo VIC 3552

ABN: 26 625 235 216

Wealth: John Archibald and Red Lion Wealth Advisory
are authorised representatives of Red Lion Wealth Services.
ABN: 19 646 760 152 AFSL: 529637. Office Location:147 Queen Street Bendigo Vic 3550