How can I maintain my business in the event I’m no longer able to make decisions?
Written by Kearney Coffin | Wills, Trusts, Tax and Probate team |20 September 2023
If you are a business owner or director considering what might happen to your business if you were unexpectedly away or unable to make decisions, it may seem like an unlikely eventuality.
But in today’s climate, there could be a number of situations which could mean you are not able to run your business as you would normally:
Working remotely and logistics prevent you from easily attending your office
Travelling abroad and being delayed or unable to return home
An accident which means you are unable to physically and/or mentally to make decisions or manage the business
An illness or medical condition which means you are unable to physically and/or mentally to make decisions or manage the business
Any of these situations could be potentially damaging for your business. Whether it is the day-to-day work in dealing with your suppliers, deliveries and services, accessing the business accounts, and sorting payroll, or the overall survival of your business and its reputation, it is important to think about what would happen if you were not able to make decisions or manage your business.
A Lasting Power of Attorney is a legal document specifically aimed to cover situations if you should lose mental capacity, allowing you to choose who you would trust (your Attorney) to manage your affairs and make decisions for you if you are not able to.
Whilst many people might associate Lasting Powers of Attorney only with their personal finances and affairs, if you are a business owner in any capacity you should consider having a separate Lasting Power of Attorney to deal with your business affairs.
A common misconception is that a spouse or family member could automatically make decisions for you if you were not able to. However, nobody automatically has legal authority to manage your financial affairs if you lose capacity.
Choosing a Business Attorney may mean having a very different person than you would choose to manage your personal affairs, as your Business Attorney needs to have the skills and abilities to competently run your business for you. This can be an incredibly useful tool for disaster and continuity plans and having a separate Business Attorney can help to ease what may be a difficult time for your relatives without the added pressure of a business to consider.
Whilst your business may have a Partnership Agreement or Articles of Association in place, it is important to review how your business would best operate in the way you would want if you were not able to manage it yourself. It is also important to ensure that any provisions your business has in place are in line with current equality and mental health discrimination laws.
If you wish to put Lasting Powers of Attorney in place or want to find out more, please call our expert Wills, Trusts, Tax and Probate team on 01752 827067 or email wills@nash.co.uk.
