Does my Will deal with my Family Business?
de Groots wills and estate lawyers
A specialist law firm in the field of wills and estate planning, estate administration and estate litigation.
Today is National Family Business Day, it's the perfect moment to celebrate the significant role family-owned businesses play in driving the economy and strengthening our communities. Family businesses are the lifeblood of Australia and New Zealand, fostering innovation, creating jobs, and cultivating a deep sense of belonging.
The Family Business Association (AU) , is the peak association for family businesses in Australia and New Zealand, dedicated to supporting these enterprises at every stage of their journey. The mission is to help family businesses succeed by focusing on one of their most unique strengths—the family itself. We believe that family dynamics are not only a distinguishing feature but also a critical marker for the success of the business. To support this mission, our training and education programs focus on empowering families within the business, helping them turn 'family' into their greatest competitive advantage.
An integral part of this support is the role played by Family Business Accredited Advisors, who help family businesses navigate the complexities they face.
Accredited advisors offer expert guidance in several key areas, including:
In this light, Kate Donnan TEP , one of our accredited family business advisors, shares her expertise, focusing on the vital need for family business succession planning. Kate emphasises that a simple Will is often inadequate for a family business, and a more comprehensive estate and succession plan is necessary to ensure the business can continue thriving across generations. Her insights into estate planning serve as an invaluable resource for business owners who want to secure their family's legacy while also easing the stress on their loved ones.
With the right planning, supported by accredited advisors like Kate, your family business can navigate challenges with confidence, ensuring a smooth transition and long-term success.
Discover more in Kate’s blog below
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Does my Will deal with my Family Business?
Most Family Businesses are not run by sole traders which means that a Will alone does not deal adequately, or at all, with a Family Business.? If the Family Business is run through a company, a Will can deal with the shares in the company but cannot direct what the new shareholders do with the Family Business.? If the Family Business is run through a discretionary trust, then a Will alone cannot deal with that business.? Your Will may be able to deal with the control of the trust (be appointing a successor trustee or giving the shares in a corporate trustee), but your Will won’t be able to dictate who gets benefits and distributions from the trust (e.g. the Family Business profits).?
Personal estate planning is more than just a Will and deciding who gets what when you pass away.? It is often prudent to deal with Family Business Succession separately from your personal estate planning.?? You may wish to deal with the succession during your lifetime and deal with what happens if you are alive but have lost capacity.
At the outset, it is important to understand how you own your assets and it is prudent to have an audit of your entities undertaken to clearly understand where all assets and control lie.? Your Family Business may not own the land on which it operates but that land might be essential to the operation of the business.? Once an audit has been undertaken and your objectives understood, then comes the time for advice on the best (including most commercial) way to achieve your desired outcomes.?
After the audit thorough estate and succession plans can be formulated encompassing all assets in which you have an interest, including your Family Business, taking account of your individual priorities and objectives.
Thorough and appropriately documented estate and succession plans should result in a reduction of the time and cost to administer your estate, relieve your family of undue stress, and facilitate a smooth transition for the Family Business to the next generation and beyond.
You may wish to complete our online questionnaire (you can click here) which will get you thinking about where your assets are held and give you a head start for your first consultation with one of our estate planning lawyers.
- Kate Donnan – Accredited Advisor with Family Business Association?