Handing Over Your Business And Planning For Retirement | Legal Advice For SMEs

Business succession planning is a key issue for all SMEs.

If you are an owner of an SME business, retirement isn't just a matter of deciding to stop working. Your retirement and the security of your family is intrinsically tied into the future success of your business.

The question of what happens to the business is therefore critical. Who's going to manage the business when you are no longer involved? Will your business even carry on or will you sell it?

Involuntary Loss Of Owner/Manager

At an early stage, owner-managers should identify their long term financial goals for retirement. How much money is required? When can that money be released from your business? What other resources are available to supplement that income? 

Once those financial goals are identified, a valuation of the existing business is essential. Can your SME business be sold? Will the sale proceeds provide sufficient return to allow a comfortable retirement? If not, what can be done to create further value in the business or how can a gradual exit from the business be facilitated?

Tax Planning

Tax planning in any succession programme is also paramount. Structuring any exit plan to ensure that any sale; transfer to new owners (including family members) and strategies to incentivise the new management team are achieved in a tax-efficient manner can have dramatic results for you and the new owners. Minimising taxes upon death, particularly for family owned businesses, is also important.

Irwin Mitchell has a specialist team comprising corporate, finance, tax and employment lawyers, who can provide expert advice on all aspects of succession planning for SME owners. We regularly advise on schemes to incentive new management teams (whether employment or share related); shareholder agreements that regulate the relationship between an outgoing owner/manager and the incoming team and your eventual exit or transfer of ownership.

Contact Us For Help With Exiting Or Handing Over A Business

For help and advice in handing over a business, contact Andrea Cropley on 0114 274 4662 or get in touch online.

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