Leading law firm Blake Morgan has today published research which shows how unprepared for the future some business owners are – and how a lack of understanding about planning could harm their dreams.
- 22 per cent of small business owners admit they don’t have a Will, and almost 30 per cent don’t have a plan in place for the future of their business.
- 33 per cent of business owners don’t understand the taxes on wealth and succession.
- But it’s a happy retirement that matters most, with 56 per cent of business owners saying one of their main priorities is working to maintain their lifestyle when they retire.
The results of the survey show that 22 per cent of small business owners don’t have a Will – potentially putting their business at risk in the event of the unexpected. When asked why they don’t have a Will, 62 per cent say they’ve not got around to it yet, 17 per cent say they don’t know how they want to distribute their assets and 11 per cent say they simply don’t want to think about their death.
A high number of business owners haven’t thought about succession planning either, with 27 per cent of business owners asked saying they don’t have a plan in place for the future. That could put the future viability and success of their business at risk when they come to retire – which is a big concern if they’re one of the 56 per cent of business owners that say one of their main priorities in life is maintaining a comfortable lifestyle in retirement.
For those that do have a plan, almost a quarter (23 per cent) plan to hand over the reins to family but with a third of entrepreneurs admitting they don’t understand wealth and succession tax requirements, they could be in for a surprise when they do plan to move on.
Helen Bunker, Divisional Director for Private Law at Blake Morgan, said:“Planning for the future can be a daunting task and it can be hard enough staying on top of daily decisions, but if you’ve invested in a business to make it a success, protecting your interests through a succession plan should be top of the agenda.
“While the survey results clearly show most business owners are thinking about the future, the fact that 33 per cent don’t understand wealth and succession tax requirements and 22 per cent don’t have a Will suggests they’re not ready to realise their dreams.
“Understanding your options for the future – whether to sell, to hand to family, or simply to walk away – is critical, and the earlier you do it the better. That’s particularly important when it comes to a Will. While none of us really want to think about it, having a Will offers significant protection for you and your family in the future.”