Anyone who wants to ensure their estate is distributed according to their wishes should write a will – and business owners are no exception.
In fact, the more money an individual accumulates, the more tempting it may be for another person to initiate an inheritance dispute. This could cause heartache between family members at an already difficult time.
Kylie Lamprecht, partner at Brisbane-based accountancy and auditing firm Pitcher Partners, says business owners spend a lifetime seeking to expand their wealth, so it's crucial to consider what will happen when they pass away.
"Succession planning is more than just making a will," she said in a media release published on the Chamber of Commerce and Industry Queensland website.
"It involves the succession of other entities you control including companies, superannuation funds and trusts. Succession planning involves planning for transition and unwelcomed disruption like death, divorce or incapacity."
According to Ms Lamprecht, the benefits of effective estate planning include tax efficiency and the appropriate distribution of assets to selected beneficiaries.
She noted that many business owners experience events that will have a consequence on their estate planning, such as setting up an organisation and purchasing property.
Ms Lamprecht said there are various questions individuals must ask themselves when considering their estate planning options:
- Do any of my beneficiaries have special requirements?
- Who would handle my financial and personal affairs in the event of loss of capacity?
- Are business partners aware of what happens to the organisation when the owner dies?
- Is my will up-to-date ?
- How should my superannuation be handled?
Estate planning is an ongoing process, with Ms Lamprecht suggesting people review their current arrangement every couple of years to take into account changes in beneficiaries and asset ownership.
Are you a business owner considering your estate planning options? Please get in touch with an expert wills and estates lawyer today.