Business Owners' Will Checklist
A practical checklist for business owners making a will: shares, agreements, executors, life cover, tax and consistency between documents.
In short
- Identify your business structure and what happens to it by default under the general law
- Locate and review any partnership, shareholders' or cross-option agreement before finalising your will
- Choose an executor able to deal with a business, or plan to bring in professional support
- Check whether business relief could reduce inheritance tax on qualifying assets
- Confirm your will and your business documents are consistent with each other
- Review everything again whenever the business or its ownership changes
Business owners have more to think through than most people when making a will, because the outcome depends not only on what the will says but on what your business's own documents allow. This checklist pulls together the key questions to work through, whether you run a company, a partnership or a sole trader business.
Use it as a starting point to identify what you already have in place, what is missing, and where you are likely to need professional advice rather than a standard will alone.
It applies to business owners in England and Wales and is not a substitute for advice tailored to your specific business.
Step 1: Confirm your business structure and its default outcome on death
Start by being clear about what actually happens to your business by default, without any special planning. A sole trader business generally ends on death, a partnership may dissolve automatically unless the agreement says otherwise, and company shares pass under the will subject to the articles of association and any shareholders' agreement.
Understanding the default position tells you how much planning is actually needed, and whether your current expectations about what will happen match reality.
- Sole trader: business generally ends; only underlying assets pass on
- Partnership: may dissolve automatically unless the agreement provides for continuation
- Limited company: continues; shares pass subject to articles and any shareholders' agreement
Step 2: Locate and review your business agreements
Find your company's articles of association, any shareholders' agreement, partnership agreement, or cross-option agreement, and check specifically what each says about what happens on the death of an owner. Look for pre-emption rights, valuation mechanisms, timeframes for payout, and whether the business is intended to continue or be wound up.
If you cannot locate these documents, or if your business has never had them properly drawn up, treat this as a priority to resolve, since your will's effectiveness for business assets depends heavily on what these documents allow.
Suitability check
Is a straightforward online will right for you?
Six quick questions. Nothing is stored and there is nothing to sign up for.
1.Do you own property or significant assets outside England and Wales?
2.Do you own a business, a share in a partnership or agricultural land?
3.Is anyone likely to challenge your will, or are you leaving out a close relative or a financial dependant?
4.Do you need to provide for someone who cannot manage their own affairs, or who receives means tested benefits?
5.Are you separated but not divorced, or providing for a second family or stepchildren alongside your own children?
6.Do you expect inheritance tax to be payable, or do you want to use trusts or plan for care fees?
Step 3: Choose the right executor and give them the tools they need
Decide whether your chosen executor is realistically able to deal with a business, including understanding its finances, dealing with staff and suppliers, and liaising with your accountant and solicitor, or whether you should appoint a professional executor alongside or instead of a family member.
Consider whether your will should give your executors specific powers, such as the power to carry on the business temporarily, borrow money, or engage professional advisers, and make sure they know where to find key business information.
- Is my chosen executor able and willing to deal with a business?
- Should I appoint a professional executor alongside or instead of family?
- Does my will give my executors the specific powers they may need?
- Do my executors know where to find business records, agreements and key contacts?
Step 4: Check funding and life cover arrangements
If you have co-owners, consider whether a cross-option agreement backed by life insurance is in place to fund a buyout of your share, giving your family fair value quickly while letting the business continue under existing ownership. Check that any existing arrangement of this kind still reflects the current value and ownership of the business.
Review the level of cover periodically, since a policy set up years ago at an earlier valuation may no longer provide an adequate payout.
Step 5: Think about inheritance tax and business relief
Business relief can reduce inheritance tax on qualifying trading business assets, but the rules are detailed, exclude investment-focused businesses, and are subject to specific ownership and trading conditions, with further changes to the rules announced for the future. Do not assume relief automatically applies to your business without checking.
Get a proper assessment of your likely inheritance tax position from a solicitor or tax adviser, particularly if your business represents a significant part of your overall estate.
Step 6: Make sure everything is consistent, and review it regularly
Cross-check your will against your business agreements to make sure there are no conflicts, and update either document if your ownership, structure or wishes change. A will and a shareholders' agreement that were consistent when both were written can easily drift apart after a business changes shape.
Set a habit of reviewing your will and your business succession arrangements together, for example whenever the business takes on new investment, changes structure, or after any major change in your personal circumstances such as marriage, divorce or new family members.
- Does my will match what my articles or partnership agreement actually allow?
- Have I reviewed both since any change in ownership or structure?
- Would my family understand what to do if I died tomorrow?
- Have I had my plans reviewed by a solicitor if my business is anything other than straightforward?
Questions people ask
Related guidance
- Making a Will if You Own a BusinessA business changes what your will needs to cover, and who is capable of dealing with it.
- What Happens to a Business When the Owner Dies?The outcome depends entirely on how the business was structured.
- What Happens to Company Shares When You Die?Shares pass under your will, but the process and any restrictions come from the company's own documents.
- What Happens to a Partnership Interest When You Die?Without an agreement saying otherwise, a partnership can dissolve automatically on a partner's death.
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This guidance covers the law of England and Wales and is general information, not legal advice about your circumstances. The rules in Scotland and Northern Ireland differ.