Why Do You Need An Estate Plan If You Own A Business?

Ravi Solanki • August 1, 2026

If you run your own business, you can’t afford to ignore estate planning. It might feel like an activity that can “wait until later”, but the reality is that you need certain mechanisms in place to protect your company in the event that you’re not able to run it any longer.

This might be due to retirement, ill health or your passing. Whatever the reason you have to step away from your business, it’s essential that you have a plan in place to protect what you’ve built and the legacy you’ll leave.

To put this in perspective, research from Legal & General found that 26 per cent of small and medium enterprises (SMEs) in the UK would close as soon as a key person, like a founder, became seriously ill or passed away.

It isn’t just a hypothetical question either. The survey found that among SMEs who had lost a key person due to illness or death, 30 per cent reported that it had impacted their profits.

What do you need to consider when estate planning for your business?

There are several foundational elements to consider as part of your estate plan to ensure continuity for the running of your business. These are:

Business will
Business continuity plan
Business lasting power of attorney (LPA)

In addition to these three elements, you may also want to consider using trusts and other agreements to ensure that your business can continue to operate smoothly when you’re no longer there to manage it.

Business will

This might be part of your will, rather than an entirely separate document, but either way it should set out who should take ownership of your company in the event of your death, as well as who you want to manage the business.

These might not be the same people – if you have a strong manager in your company, you may want them to take over the reins operationally, for instance, while your family retains ownership of the business as a whole.

You can think of a business will as a succession plan. It is a living document that you should revisit and update regularly as circumstances change.

Business continuity plan

Every business should have one of these in place to outline how you’ll deal with any significant disruption.

While these are often framed as a way to ensure your business can continue to operate if it suffers a cyber attack or natural disaster, they are just as useful when considering your estate planning.

A business continuity plan is an exercise in strategic risk management and it is worth its weight in gold should your company face any major disruptions.

Business lasting power of attorney

This is similar to the property and financial affairs LPA that you would set up to enable a chosen loved one to manage your finances for you in the event that you are incapacitated.

A business LPA, as the name suggests, is a legal mechanism that will allow someone you trust to keep your company operational, by giving them access to the business bank accounts, payroll and other essential systems.

In some cases, this scenario can be covered by your company’s articles of association. However, it is always best to check what provisions are in place.

This is why we advise booking a Clarity Call with one of our experts to ensure you receive tailored advice about how to incorporate your business into your estate plan.

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3 Reasons To Get Support With Your Estate Plan

By Ravi Solanki • September 7, 2026

Discover three of the top reasons to seek professional support with your estate plan and learn how working with an estate planner can improve your situation.

When Should You Start Estate Planning?

By Ravi Solanki • August 28, 2026

Too many people in the UK still shy away from estate planning, as evidenced by research indicating that 56 per cent of adults in the country do not have a will in place. This only falls slightly, to 53 per cent, for those aged 50 to 64, indicating that many people are sticking their heads in the sand when it comes to what will happen to their assets when they pass away. But, of course, a will is only one element of an estate plan. There are many approaches you can use to help protect the wealth you have accumulated throughout your lifetime to pass on to your family and ensure they continue to reap the benefits of what you’ve sown. When should you start estate planning? The reality is that the sooner you start estate planning, the better. This is because an estate plan is not an activity you do once and then ignore. It is a living, breathing plan that can adapt as your life changes. Many people wait until their later years before they start thinking about what will happen to their wealth once they pass away. While it is certainly better to engage with estate planning services in your 60s than not to do so at all, it is even more helpful if you start at a younger age. One of the reasons for starting earlier is that you can make your wishes clear and ensure you have a plan in place before there could be questions over your mental capacity. It is a confronting fact, but the number of people with dementia in the UK is expected to rise to 1.4 million by 2040 , which means if you leave this process too late you may not be in a position to take control of your estate planning yourself. I share this not to scare you, but to highlight a genuine risk that many people overlook. What are the benefits of early estate planning? There are many advantages to starting your estate planning as soon as possible, chief among them that it gives you control over your future. Estate planning is an overwhelmingly empowering process and I see my clients go from feeling nervous at the prospect to feeling both relieved and in more control of their finances once they have created an estate plan with me. Other benefits of estate planning include: Being in a position to adapt your approach to new legislation around taxation. Being able to maximise the money you give tax-free to your family and loved ones. Reducing your inheritance tax bill by making smart financial choices. Maximising the amount you can give to members of your family and loved ones as tax-free gifts can be an important part of an estate plan. Under current rules, when you give someone money, that sum becomes exempt from inheritance tax provided you survive for at least seven years after making the gift. Of course, there are more complex rules surrounding this process than merely surviving seven years, and there are annual limits on how much of your wealth you can give away and in what form. This is why working with an experienced estate planner is so important. I’m here to talk you through your estate planning options at any time, simply book a Clarity Call to get started.