A Plan is the Barrier Between Your Family and Crisis

The news briefly covered a journalist's dismissal from a tragic criminal trial. It was a footnote to a family’s private agony. It shows how, when things go badly wrong, the outside world often only sees the drama.

I sit with families through a different kind of collapse. It doesn’t make the six o'clock news, but it tears people apart all the same. I worked with one such family: two brothers and a sister who took over their father’s engineering firm. He built it for 40 years. It was worth £1.2 million. Within 18 months of his death, the business was gone. So was the family’s relationship.

The Point of Failure The father was the business. His death was sudden. The first failure was simple: no specific business succession plan. His personal will left his estate 'to my children in equal shares', but his company shares were tied up in an old partnership agreement that contradicted the will. The second failure was the Lasting Power of Attorney. He had made one appointing his daughter, but it only covered health and welfare. He had no LPA for property and financial affairs. When he became ill before he died, no one had the legal authority to make decisions for the company. The third failure was a personal guarantee he’d signed for a £300,000 business loan years earlier. He thought it had expired. It had not.

The Tax Implication A solid plan would have secured 100% Business Property Relief on the company shares. This is a legitimate and powerful relief for trading businesses owned for at least two years. The full £1.2 million value could have passed to the children with zero Inheritance Tax. Instead, the infighting and lack of authority paralysed the firm. Key contracts were lost. The bank saw the chaos and called in its £300,000 loan. With the personal guarantee active, the children’s own assets were now exposed. The business was sold for parts to pay the debt. An asset worth over a million became a liability that threatened the family home.

A plan provides clarity in a crisis. These documents – a clear will, the correct LPAs, a review of shareholder agreements – are the tools. They provide a clear set of instructions for when you are not there to give them. They are the barrier between your family and a crisis that can destroy wealth and relationships. I’ve seen what happens on both sides of that barrier. If what you've built matters, we should talk.